2013 Sustainability Report
Transcription
2013 Sustainability Report
Headquartered in Richmond, British Columbia (B.C.), Catalyst Paper employs 1,611 people and operates three mills and a distribution facility on Canada’s Pacific coast. Our combined annual production capacity of 1.5 million tonnes meets the needs of customers, including retailers, publishers, commercial printers, and manufacturers who use our pulp, in North America, Latin America, the Pacific Rim and Europe. Catalyst Paper Corporation 2nd Floor, 3600 Lysander Lane Richmond, B.C. V7B 1C3 604-247-4400 LIGHTER IS BETTER MESSAGE FROM THE PRESIDENT + CEO 04 PEOPLE 16 PAPER 28 PERFORMANCE 32 THE RESULTS: ENVIRONMENTAL DATA 41 REGULATORY COMPLIANCE 48 GRI INDEX 50 CATALYST PAPER 2013 SUSTAINABILITY REPORT www.catalystpaper.com We have earned a reputation for environmental stewardship based on our commitment to certified fibre sourcing, manufacturing efficiency, verified chain of custody and environmentally responsible paper operations. A public company, Catalyst’s shares trade on the Toronto Stock Exchange (TSX) under the symbol CYT. KEY FACTS AND FIGURES 01 PAPER FACTS inside pages of report (120.3 g) Production Notes INPUTS Raw Fibre (g) % certified sources 113 100 Filler (g) 45 Water (L) 9.1 Work (person secs) Energy (Cal) % renewable 1.3 664 91 EMISSIONS Greenhouse Gas (g) 11* Air Particulate (mg) 2.9 Effluent BOD (mg) 58 Solid Waste (cm3) 10 * Offset to zero The inside pages of this report are printed on Ascent Gloss Sage, Catalyst’s new coated three grade, produced at the Port Alberni mill. Ascent is our highest quality coated paper grade. Its brightness, superior opacity and excellent printability make it ideal for magazine, catalogue, high-end insert, commercial and direct mail print applications printed on heatset offset presses. Catalyst’s coated products are available under our Sage program, meaning they are certified (Programme for the Endorsement of Forest Certification) as containing 100% fibre from sustainably managed forests, that there were no net carbon emissions during their manufacture, and that detailed mill-level environmental performance data are available via GreenBlue’s Environmental Paper Assessment Tool (EPAT). We also contribute $1 for every tonne of Sage product sold to support our partner initiatives. The Paper Facts label identifies the inputs and emissions associated with this specific grade of paper calculated on a per-report basis. Catalyst customers can use the online Paper Calculator at http://catalystpaper.com/calculator to identify inputs and emissions associated with their own purchases and to compare them to typical North American paper products. This report was printed with inks that are formulated to contain plant-derived materials, and that comply with North American toxics-in-packaging legislation for heavy metal content. READ MORE ONLINE ABOUT OUR COMPANY catalystpaper.com/about/our-facilities Our manufacturing facilities have long histories and are economic drivers in the coastal communities where they are located. Headquartered in Richmond, British Columbia (B.C.), Catalyst Paper employs 1,611 people and operates three mills and a distribution facility on Canada’s Pacific coast. Our combined annual production capacity of 1.5 million tonnes meets the needs of customers, including retailers, publishers, commercial printers, and manufacturers who use our pulp, in North America, Latin America, the Pacific Rim and Europe. Catalyst Paper Corporation 2nd Floor, 3600 Lysander Lane Richmond, B.C. V7B 1C3 604-247-4400 LIGHTER IS BETTER MESSAGE FROM THE PRESIDENT + CEO 04 PEOPLE 16 PAPER 28 PERFORMANCE 32 THE RESULTS: ENVIRONMENTAL DATA 41 REGULATORY COMPLIANCE 48 GRI INDEX 50 CATALYST PAPER 2013 SUSTAINABILITY REPORT www.catalystpaper.com We have earned a reputation for environmental stewardship based on our commitment to certified fibre sourcing, manufacturing efficiency, verified chain of custody and environmentally responsible paper operations. A public company, Catalyst’s shares trade on the Toronto Stock Exchange (TSX) under the symbol CYT. KEY FACTS AND FIGURES 01 PAPER FACTS inside pages of report (120.3 g) Production Notes INPUTS Raw Fibre (g) % certified sources 113 100 Filler (g) 45 Water (L) 9.1 Work (person secs) Energy (Cal) % renewable 1.3 664 91 EMISSIONS Greenhouse Gas (g) 11* Air Particulate (mg) 2.9 Effluent BOD (mg) 58 Solid Waste (cm3) 10 * Offset to zero The inside pages of this report are printed on Ascent Gloss Sage, Catalyst’s new coated three grade, produced at the Port Alberni mill. Ascent is our highest quality coated paper grade. Its brightness, superior opacity and excellent printability make it ideal for magazine, catalogue, high-end insert, commercial and direct mail print applications printed on heatset offset presses. Catalyst’s coated products are available under our Sage program, meaning they are certified (Programme for the Endorsement of Forest Certification) as containing 100% fibre from sustainably managed forests, that there were no net carbon emissions during their manufacture, and that detailed mill-level environmental performance data are available via GreenBlue’s Environmental Paper Assessment Tool (EPAT). We also contribute $1 for every tonne of Sage product sold to support our partner initiatives. The Paper Facts label identifies the inputs and emissions associated with this specific grade of paper calculated on a per-report basis. Catalyst customers can use the online Paper Calculator at http://catalystpaper.com/calculator to identify inputs and emissions associated with their own purchases and to compare them to typical North American paper products. This report was printed with inks that are formulated to contain plant-derived materials, and that comply with North American toxics-in-packaging legislation for heavy metal content. READ MORE ONLINE ABOUT OUR COMPANY catalystpaper.com/about/our-facilities Our manufacturing facilities have long histories and are economic drivers in the coastal communities where they are located. KEY FACTS + FIGURES 1 2013 2012 2011 SOCIAL Medical incident frequency 1 Lost-time incident frequency 1 Employee population 2 Payroll ($ millions) 3 Charitable donations ($ thousands) 3.8 1.4 1,611 183 136 4.0 1.7 1,592 206 139 4.2 1.7 1,877 250 90 ECONOMIC ($ millions, unless otherwise noted) Total taxes paid 4 Total sales 5 Net earnings (loss) attributable to company 5, 6 Market capitalization 7 Adjusted EBITDA (before restructuring costs) 5 Adjusted EBITDA (before restructuring costs) as % of sales 5 27.0 1,051.4 (127.6) 20.0 47.3 20.0 1,058.2 583.2 29.0 60.7 23.0 1,079.7 (974.0) 13.0 68.7 4.5 5.7 6.4 106,877,705 30,071,303 3,527,604 1,663,248 119,534,178 35,905,617 3,839,724 1,918,165 127,361,988 36,823,417 3,932,563 1,986,642 215,122 877,865 1,071,680 77 464 78 584 91 506 971 3,952 282,642 990 3,347 161,102 INPUTS 8 (usage) Water (m3) Fuel energy 9 Electrical energy 10 Wood chips, pulp logs, old newspapers (tonnes) 2013 BOARD OF DIRECTORS AT A GLANCE COMMITMENT To continually review and improve governance procedures to keep pace with emerging regulated and voluntary practices MEMBERS 7 total 6 independent GENDER 6 male 1 female OUTPUTS 8 (tonnes, unless otherwise noted) GHG emissions (carbon dioxide equivalency – C02e) 11 Total reduced sulphur (TRS) emissions 12 Particulate emissions 12 (see page 39) Biochemical oxygen demand (BOD) Total suspended solids (TSS) Solid waste to landfill (m3) (see page 39) 1 2 3 4 5 6 Incidents per 200,000 hours worked. Active employees at year-end, excluding vacancies. Inclusive of benefits, exclusive of restructuring costs (severance). Includes property taxes, B.C. carbon tax, and sales, use, income and logging taxes. Losses from discontinued operations, net of tax, are shown separately from continuing operations in the consolidated statements of earnings (loss) in our annual consolidated financial statements for the years ended December 31, 2013, 2012 and 2011. 2013, 2012 and 2011 results were impacted by one-time non-cash accounting adjustments. CATALYST PAPER 2013 SUSTAINABILITY REPORT 1,17413 2,320 85,847 7 8 9 10 11 12 13 2012 value based on opening share value as of relisting on the TSX on January 7, 2013. 2013 value based on opening share value on December 31, 2013. Includes Snowflake. Gigajoules (GJ) – includes fossil fuels and renewables. Megawatt-hours (MWh) – includes purchased and self-generated energy. Closure of Snowflake in Sept 2012 resulted in substantial GHG reductions. Based on actual test results; National Pollutant Release Inventory (NPRI) data may differ due to use of emission factors and inclusion of other sources, see page 47. 2013 BOD discharges from Crofton were elevated compared to past years. The mill is actively investigating the cause. COMMITTEES Audit Environment, Health and Safety Governance, Human Resources and Compensation ADDITIONAL INFORMATION Copies of committee terms of reference, codes of conduct and standards of governance are available at www.catalystpaper.com/ about/governance THE BIG PICTURE: PEOPLE PAPER PERFORMANCE WHAT IS THIS REPORT ABOUT? This report focuses on the wholly owned operations and worldwide sales of Catalyst Paper from January 1 to December 31, 2013. In this, our 11th sustainability report, we follow the Global Reporting Initiative’s (GRI) G4 guidelines and self declare in accordance with core disclosure. As in past years, the report covers those aspects of performance that are of most interest to our stakeholders. Our scope is largely unchanged from last year when our report earned the Chartered Professional Accountants award for corporate reporting. Our business circumstances in 2013 prevented us from contributing financially to the UN Global Compact and the Global Compact Canadian Network. Although we have withdrawn from the initiative, we remain committed to – and take guidance from – the principles of the UN Global Compact. We did not seek formal external assurance on the report, although we share the views of stakeholders on some of our key issues and initiatives. And we welcome reader feedback on this report, as well as ideas for future editions. Please share your thoughts with us by emailing [email protected] IMPACTS + BENEFITS ENVIRONMENT SOCIAL FINANCING LOW-IMPACT PRODUCTION PARTNERSHIPS + STAKEHOLDERS INVESTORS WATER QUALITY P37 GOVERNMENTS P19 CREDITORS CLIMATE CHANGE + GHGS P40 COMMUNITIES P26-27, 35-36 PERFORMANCE: PROGRESS ON 5 FRONTS NON-GOVERNMENTAL GROUPS P20-21 REGULATORY COMPLIANCE P48 1 RESOURCE USE MANUFACTURING PROCESS OUR PRODUCTS CORPORATE ATE E + DISTRIBUTION DISTR ON CUSTOMERS + COMPETITIVENESS P29-32, 36 ENERGY P38 MAGAZINES BOOKS DIRECTORIES WOOD FIBRE P37 CATALOGUES BROCHURES DIRECT MAIL RETAIL INSERTS NEWSLETTERS REPORTS, MANUALS, COMICS, GRAPHIC NOVELS EMPLOYEES + UNIONS P24 RENEWAL + RETENTION P22-24 SAFETY P25 EFFICIENCY P45 NEWSPAPERS POWELL RIVER PORT ALBERNI Produces paper for directories, catalogues, brochures, inserts, flyers and magazines such as Baron’s, Men’s Journal, In Touch, US Weekly and Rolling Stone TRANSPARENCY + DISCLOSURE P50 Produces paper for catalogues, magazines, newsletters, high volume magazines and books, including Fifty Shades of Grey, the fastest-selling paperback of all time NANAIMO FLYERS SURREY DISTRIBUTION CENTRE RICHMOND CROFTON Produces enough paper every year for 100 million phone books + 150 million daily newspapers including The Globe and Mail, The Wall Street Journal and The New York Times 2 3 5 4 INPUTS MANUFACTURING TRANSPORTATION PAPER LIFE CYCLE TRANSPARENCY 85% of our purchased raw inputs are waste products Yield focused – use less, waste less Multi-modal efficient logistics to reduce material miles and carbon emission from shipping finished product Partnerships to gain sustainability insight with organizations like World Wildlife Fund (WWF), GreenBlue, Greenpeace, Sierra Club BC, Forest Ethics and Corporate Knights Along the supply chain WATER P37 OTHER KEY MATERIALS P46 GENERAL MANAGERS + COMMUNITY LIAISON ENVIRONMENTAL LIAISON 2nd Floor, 3600 Lysander Lane Richmond, B.C. V7B 1C3 604-247-4400 CROFTON CROFTON Robert Belanger, General Manager P.O. Box 70 Crofton, B.C. V0R 1R0 250-246-6100 Brian Houle, Manager, Environment P.O. Box 70 Crofton, B.C. V0R 1R0 250-246-6236 PORT ALBERNI PORT ALBERNI BRIAN BAARDA Vice-President, Finance and Chief Financial Officer Fred Chinn, General Manager 4000 Stamp Avenue Port Alberni, B.C. V9Y 5J7 250-724-7525 Larry Cross, Manager, Environment 4000 Stamp Avenue Port Alberni, B.C. V9Y 5J7 250-724-7889 STEVE BONIFERRO Senior Vice-President, Human Resources POWELL RIVER POWELL RIVER Brian Johnston, General Manager 5775 Ash Avenue Powell River, B.C. V8A 4R3 604-483-3722 Sarah Barkowski, Manager, Environment 5775 Ash Avenue Powell River, B.C. V8A 4R3 604-483-2850 JOE NEMETH President and Chief Executive Officer FIRST NATIONS P19 SOLID WASTE P39 CATALYST PAPER CORPORATION Visit us online at www.catalystpaper.com ECONOMIC AIR QUALITY P39 CONTACTING CATALYST Certified chain of custody to Forest Stewardship Council (FSC) and Programme for the Endorsement of Forest Certification (PEFC) 90% renewable energy in our product manufacturing All of our fibre is from sustainably well-managed forests High-opacity paper offering bulk with less weight Paper with one of the lowest carbon footprints in North America High quality handling delivers orders on time, damage free GRAHAM KISSACK Sustainability Specialist On product labels highlighting pedigree and footprint LESS IS MORE Carbon, forest footprint, water disclosure as well as reporting to GreenBlue’s Environmental Paper Assessment Tool (EPAT) First environmental report published in 1993 www.catalystpaper.com/about/stance A five-point operating philosophy guides our efforts to continually meet the high expectations of our customers, investors, employees, communities and other stakeholders. 2013 READ MORE ONLINE Our annual financial report and sustainability summary foldout wrap for 2013 are available in the Investor Relations section of our website. This report contains forward-looking statements. Forward-looking statements are statements, other than statements of historical fact, that address or discuss activities, events or developments that Catalyst Paper expects or anticipates may occur in the future. These forward-looking statements can be identified by the use of words such as “anticipate”, “could”, “expect”, “seek”, “may”, “likely”, “intend”, “will”, “believe” and similar expressions or the negative thereof. These forward-looking statements reflect management’s current views and are based on certain assumptions and factors management believes are appropriate in the circumstances, including assumptions that there will be no material change to the regulatory environment in which the company operates, capital budgeted for certain goals will be available, and existing relationships with stakeholders will be maintained. Such forward-looking statements are subject to risks and uncertainties and no assurance can be given that any of the events anticipated by such statements will occur nor, if they do occur, what benefit Catalyst will derive from them. No forward-looking statement is a guarantee of future results. A number of factors could cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements, including technological and regulatory changes, cost constraints, Catalyst’s ability to successfully obtain operational and environmental performance improvements, and other factors beyond its control. Catalyst disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Designed and produced by smith + associates www.smithandassoc.com Please recycle THE BIG PICTURE: PEOPLE PAPER PERFORMANCE WHAT IS THIS REPORT ABOUT? This report focuses on the wholly owned operations and worldwide sales of Catalyst Paper from January 1 to December 31, 2013. In this, our 11th sustainability report, we follow the Global Reporting Initiative’s (GRI) G4 guidelines and self declare in accordance with core disclosure. As in past years, the report covers those aspects of performance that are of most interest to our stakeholders. Our scope is largely unchanged from last year when our report earned the Chartered Professional Accountants award for corporate reporting. Our business circumstances in 2013 prevented us from contributing financially to the UN Global Compact and the Global Compact Canadian Network. Although we have withdrawn from the initiative, we remain committed to – and take guidance from – the principles of the UN Global Compact. We did not seek formal external assurance on the report, although we share the views of stakeholders on some of our key issues and initiatives. And we welcome reader feedback on this report, as well as ideas for future editions. Please share your thoughts with us by emailing [email protected] IMPACTS + BENEFITS ENVIRONMENT SOCIAL FINANCING LOW-IMPACT PRODUCTION PARTNERSHIPS + STAKEHOLDERS INVESTORS WATER QUALITY P37 GOVERNMENTS P19 CREDITORS CLIMATE CHANGE + GHGS P40 COMMUNITIES P26-27, 35-36 PERFORMANCE: PROGRESS ON 5 FRONTS NON-GOVERNMENTAL GROUPS P20-21 REGULATORY COMPLIANCE P48 1 RESOURCE USE MANUFACTURING PROCESS OUR PRODUCTS CORPORATE ATE E + DISTRIBUTION DISTR ON CUSTOMERS + COMPETITIVENESS P29-32, 36 ENERGY P38 MAGAZINES BOOKS DIRECTORIES WOOD FIBRE P37 CATALOGUES BROCHURES DIRECT MAIL RETAIL INSERTS NEWSLETTERS REPORTS, MANUALS, COMICS, GRAPHIC NOVELS EMPLOYEES + UNIONS P24 RENEWAL + RETENTION P22-24 SAFETY P25 EFFICIENCY P45 NEWSPAPERS POWELL RIVER PORT ALBERNI Produces paper for directories, catalogues, brochures, inserts, flyers and magazines such as Baron’s, Men’s Journal, In Touch, US Weekly and Rolling Stone TRANSPARENCY + DISCLOSURE P50 Produces paper for catalogues, magazines, newsletters, high volume magazines and books, including Fifty Shades of Grey, the fastest-selling paperback of all time NANAIMO FLYERS SURREY DISTRIBUTION CENTRE RICHMOND CROFTON Produces enough paper every year for 100 million phone books + 150 million daily newspapers including The Globe and Mail, The Wall Street Journal and The New York Times 2 3 5 4 INPUTS MANUFACTURING TRANSPORTATION PAPER LIFE CYCLE TRANSPARENCY 85% of our purchased raw inputs are waste products Yield focused – use less, waste less Multi-modal efficient logistics to reduce material miles and carbon emission from shipping finished product Partnerships to gain sustainability insight with organizations like World Wildlife Fund (WWF), GreenBlue, Greenpeace, Sierra Club BC, Forest Ethics and Corporate Knights Along the supply chain WATER P37 OTHER KEY MATERIALS P46 GENERAL MANAGERS + COMMUNITY LIAISON ENVIRONMENTAL LIAISON 2nd Floor, 3600 Lysander Lane Richmond, B.C. V7B 1C3 604-247-4400 CROFTON CROFTON Robert Belanger, General Manager P.O. Box 70 Crofton, B.C. V0R 1R0 250-246-6100 Brian Houle, Manager, Environment P.O. Box 70 Crofton, B.C. V0R 1R0 250-246-6236 PORT ALBERNI PORT ALBERNI BRIAN BAARDA Vice-President, Finance and Chief Financial Officer Fred Chinn, General Manager 4000 Stamp Avenue Port Alberni, B.C. V9Y 5J7 250-724-7525 Larry Cross, Manager, Environment 4000 Stamp Avenue Port Alberni, B.C. V9Y 5J7 250-724-7889 STEVE BONIFERRO Senior Vice-President, Human Resources POWELL RIVER POWELL RIVER Brian Johnston, General Manager 5775 Ash Avenue Powell River, B.C. V8A 4R3 604-483-3722 Sarah Barkowski, Manager, Environment 5775 Ash Avenue Powell River, B.C. V8A 4R3 604-483-2850 JOE NEMETH President and Chief Executive Officer FIRST NATIONS P19 SOLID WASTE P39 CATALYST PAPER CORPORATION Visit us online at www.catalystpaper.com ECONOMIC AIR QUALITY P39 CONTACTING CATALYST Certified chain of custody to Forest Stewardship Council (FSC) and Programme for the Endorsement of Forest Certification (PEFC) 90% renewable energy in our product manufacturing All of our fibre is from sustainably well-managed forests High-opacity paper offering bulk with less weight Paper with one of the lowest carbon footprints in North America High quality handling delivers orders on time, damage free GRAHAM KISSACK Sustainability Specialist On product labels highlighting pedigree and footprint LESS IS MORE Carbon, forest footprint, water disclosure as well as reporting to GreenBlue’s Environmental Paper Assessment Tool (EPAT) First environmental report published in 1993 www.catalystpaper.com/about/stance A five-point operating philosophy guides our efforts to continually meet the high expectations of our customers, investors, employees, communities and other stakeholders. 2013 READ MORE ONLINE Our annual financial report and sustainability summary foldout wrap for 2013 are available in the Investor Relations section of our website. This report contains forward-looking statements. Forward-looking statements are statements, other than statements of historical fact, that address or discuss activities, events or developments that Catalyst Paper expects or anticipates may occur in the future. These forward-looking statements can be identified by the use of words such as “anticipate”, “could”, “expect”, “seek”, “may”, “likely”, “intend”, “will”, “believe” and similar expressions or the negative thereof. These forward-looking statements reflect management’s current views and are based on certain assumptions and factors management believes are appropriate in the circumstances, including assumptions that there will be no material change to the regulatory environment in which the company operates, capital budgeted for certain goals will be available, and existing relationships with stakeholders will be maintained. Such forward-looking statements are subject to risks and uncertainties and no assurance can be given that any of the events anticipated by such statements will occur nor, if they do occur, what benefit Catalyst will derive from them. No forward-looking statement is a guarantee of future results. A number of factors could cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements, including technological and regulatory changes, cost constraints, Catalyst’s ability to successfully obtain operational and environmental performance improvements, and other factors beyond its control. Catalyst disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Designed and produced by smith + associates www.smithandassoc.com Please recycle LOOKING BACK: 2013 HIGHLIGHTS 2 Catalyst’s new class of common shares began trading on the TSX under the symbol CYT For seventh straight year, Catalyst named by Corporate Knights as one of the 2013 Best Corporate Citizens in Canada Our 2013 average greenhouse gas emissions of 149 kg CO2e per tonne of paper is among the lowest in all of North America Completion of recommendations to government for Ecosystem Based Management in the Great Bear Rainforest Certified Professional Accountants (CPA) Small Cap Venture Award of Excellence 2013 Corporate Reporting Awards Globe and Mail publisher endorses Catalyst as benchmark supplier Port Alberni mill marked 10 years as the supplier of coated mechanical paper for Rolling Stone Magazine CATALYST PAPER 2013 SUSTAINABILITY REPORT LOOKING AHEAD: 2014 VISION + GOALS 1 EXECUTE operational excellence in: Employee safety Cost efficiency Productivity Regulatory compliance 2 PRODUCE the best paper products for current and new, niche markets and continue great product and market development CATALYST PAPER 2013 SUSTAINABILITY REPORT 3 EXPLORE transformative investments such as green energy and biofuel 4 GAIN confidence of financial markets and secure new capital for investment 5 CONTINUE collaboration to advance sustainability 3 OPPORTUNITY CONFIDENCE ACTION 4 MESSAGE FROM THE PRESIDENT + CEO CATALYST PAPER 2013 SUSTAINABILITY REPORT 5 I believe in the company and the people at Catalyst When I came to Catalyst in late 2013, there were those who questioned why I would join an organization in a sector, considered by some, to be a sunset industry. To me, the answer was straight forward: I see a real opportunity for the company and its people. We take waste materials from renewable forests and, using green energy in our modernized facilities, make some of British Columbia’s highest value-add forest products. We continue to lead in environmental and social performance, two of the core attributes of sustainability. And we have a clear line of sight on the importance of economic performance. OUR PEOPLE DRIVE OUR SUCCESS As we strive to build upon the improved financial performance we achieved in the second half of 2013, and to sustain a cash positive position in 2014, there will be a number of groups monitoring our performance. As the new CEO, one of the critical audiences for me is employees – because our people drive our success. The Catalyst workforce has been through a tumultuous time and one of my most important jobs is to instil CONFIDENCE. A confident workforce BELIEVES in the future and takes ACTION to secure that future. We have delivered the message to our employees that their thoughts are both welcome and needed as we strive to improve cost competitiveness. By the end of 2013, we had received more than 200 ideas to optimize performance from across the company. These range from small gestures that will accrue long-term savings, to larger initiatives such as those achieved by reclaiming residual fibre from water destined for sewage discharge. We want to leverage employee innovation and skill to develop new products and explore transformative business options such as green energy or biofuel. And we want to run an operation that has world-class safety performance. Our objective is to create an upward spiral built upon success, which we look forward to sharing with you in next year’s report. SUSTAINABILITY AS BUSINESS STRATEGY Catalyst’s impressive record on sustainability was a significant factor in my decision to join the company. Looking at our industry, I know that none of our peers’ sustainability programs are as strong. From our partnerships with non-governmental organizations to our decades-long reporting record, from our emissions reduction to our safety initiatives, Catalyst is the leader. To retain that position, we will continue to embed social responsibility into business strategy, keeping it as the central tenet of our business proposition: LIGHTER IS BETTER, LESS IS MORE. This will require addressing a number of challenges. Retaining our existing employees is a priority, especially in an increasingly competitive labour market. Given the demographics of our workforce, we also know we need to attract new workers. Current projections tell us that we will see 10 per cent of our workforce retiring every year for the next 10 years. This creates an opportunity for more than 150 new people to join Catalyst each year between now and 2024. We know our sustainability record makes us attractive. Where this might once have been an interesting sidebar to our story, today we see it as essential for attracting new talent. +150 Opportunity for more than 150 new people to join Catalyst each year between now and 2024. CATALYST PAPER 2013 SUSTAINABILITY REPORT 100% We sell 100 per cent of our pulp and more than 20 per cent of the paper we produce offshore. 6 CHALLENGE + OPPORTUNITY A sustainable employee base is the most fundamental priority, yet we must also address other challenges. A number of global issues directly affect our business. We sell 100 per cent of our pulp and more than 20 per cent of the paper we produce offshore. This makes the global economy important, especially the economies of China and Latin America. In addition, we sell a large percentage of our printing and writing paper into the United States (U.S.), where we are seeing a continuing trend towards electronic substitution. As many of our sales are recorded in U.S. dollars, the American economy and exchange rates have a definite impact on our bottom line. And, excess paper production capacity in North America means it is essential that we be cost competitive and constantly pursuing better margin opportunities. In British Columbia, where all of our operations are now located, we must grapple with rising BC Hydro rates, fibre supply constraints, and evolving compliance requirements. Operating in British Columbia means we pay carbon taxes above other jurisdictions. This tax – $30 per tonne of CO2 – adds over $5 per tonne of paper to our cost structure. Also of note, in the spring of 2014, British Columbia will introduce a water sustainability act, a regulation to the allocation of water rights that will, for the first time, impose fees for the use of groundwater and allow government to restrict water use in times of scarcity. We recognize that in an increasingly competitive world, we need to continue to focus on those aspects of the business that have been working and continue efforts to address industry challenges. A year ago, our chances of success did not look promising. But after spending five months in the company, I have a different view today. I believe in our people and the future of Catalyst Paper. This report details the accomplishments of 2013, the effort we have made to maintain our social licence to operate, to leverage that social licence for our competitive advantage, and to continue our record of environmental performance. At Catalyst, each of these initiatives contributes to operational efficiency and proves that WE CAN DO MORE WITH LESS. The views of our stakeholders shape the issues on which we focus. Your comments, suggestions and questions are always welcome. JOE NEMETH President and Chief Executive Officer CATALYST PAPER 2013 SUSTAINABILITY REPORT 7 20 YEARS OF SUSTAINABILITY LEADERSHIP CATALYST PAPER 2013 SUSTAINABILITY REPORT OUR HISTORY: 1993 TO 2013 8 HERE’S TO THE LAST 20 YEARS... 1993 56% First environmental report published in 1993 Fifty six per cent of fibre supply is certified from sustainably managed forests under Forest Stewardship Council (FSC) and Programme for the Endorsement of Forest Certification (PEFC) 90% $1billion More than $1 billion spent improving environmental control infrastructure at mills to achieve top quartile to top decile performance renewables 84% Reduced reliance on fossil fuels and embraced use of renewable energy 2013 absolute GHG emissions reduced 84 per cent from 1990 levels Offer forest certified, carbon neutral paper products under the Sage brand 7years 2012 Maintain active partnerships with WWF, ForestEthics, Greenpeace Canada, Sierra Club BC, GreenBlue, Canadian Business for Social Responsibility and Corporate Knights to help improve performance and tackle material global issues Named for seven consecutive years by Corporate Knight as one of the Best 50 Corporate Citizens in Canada Catalyst joins forward-looking companies to establish the Council for Clean Capitalism, a group advocating policy change to ensure what is good for business is good for the environment and society HERE’S TO THE NEXT 20 YEARS... CATALYST PAPER 2013 SUSTAINABILITY REPORT JANUARY 2014 MILESTONE } Recommendations to achieve ecosystem-based management in the Great Bear Rainforest were reached by the members of the Joint Solutions Project. Catalyst is a founding member of this group. This work with Greenpeace, Sierra Club BC, ForestEthics and other stakeholders to protect B.C.’s Great Bear Rainforest has created a groundbreaking forest management template admired around the world. 9 CATALYST PAPER 2013 SUSTAINABILITY REPORT 10 56% of the fibre delivered to our Canadian mills was independently certified to one of the three main recognized third-party groups. CATALYST PAPER 2013 SUSTAINABILITY REPORT TODAY’S PAPER IS MADE RESPONSIBLY For the same amount of printing surface, our lighter basis weight papers use less fibre to produce. That means less impact on resources, a smaller carbon footprint to transport and all the same benefits of printability, opacity, brightness and feel. DENIS FORTIER Manager, Product Development CATALYST PAPER 2013 SUSTAINABILITY REPORT 11 12 One of my accountabilities is to ensure the reinvestment into our facilities and employees creates a competitive advantage for Catalyst in the global marketplace. This helps sustain our business while strengthening the economies of local communities. STEW GIBSON Manager, Manufacturing and Technical Services CATALYST PAPER 2013 SUSTAINABILITY REPORT LIGHTER IS BETTER, LESS IS MORE 22 days We agreed to hold back the water in Lake Cowichan and Cowichan River by 22 days to conserve water and natural fish habitat. CATALYST PAPER 2013 SUSTAINABILITY REPORT 13 14 90% of the energy used in our manufacturing processes comes from renewable hydroelectric power and biomass waste bark boiler fuel. CATALYST PAPER 2013 SUSTAINABILITY REPORT WASTE LESS Getting our products to customers damage-free results in savings in time, resources, and in the manufacturing process, as well as reducing our transportation carbon footprint. It all adds up to less waste. AVRIL LOFT General Manager Surrey Distribution Centre CATALYST PAPER 2013 SUSTAINABILITY REPORT 15 PEOPLE 16 Our workplace fosters problem solving and forward thinking strategies that lead to positive results that both improve business processes and environmental sustainability. JOANNE BOUTILIER Distribution Supervisor CATALYST PAPER 2013 SUSTAINABILITY REPORT 17 People and partnerships drive our success With over 100 years of papermaking history, we are passionate about our paper products and people. We recognize people are looking for more than a job; they are looking for a career. We employ a range of individuals with diverse personal and professional backgrounds that help us manufacture 1.5 million tonnes of specialty printing papers, newsprint and pulp for our customers around the globe. CERTIFICATION RECOGNITION COLLABORATION Council for CLEAN CAPITALISM CATALYST PAPER 2013 SUSTAINABILITY REPORT STAKEHOLDER ENGAGEMENT SHAREHOLDERS BONDHOLDERS 18 INVESTORS BANKS In British Columbia, where all of our operations are located, Catalyst injects $2 billion annually into the economy and supports 7,000 jobs 1. We operate in coastal communities, adjacent to First Nation lands, and in metropolitan centres. Government agencies regulate our environmental and safety performance. Stakeholders monitor our financial performance. Our supply chain reaches into communities in British Columbia, in Canada and abroad. EMPLOYEES UNIONS POWELL RIVER PORT ALBERNI CORPORATE SURREY DISTRIBUTION CENTRE NANAIMO RICHMOND BOARD OF DIRECTORS CROFTON COMMUNITY ORGANIZATIONS RETIREES $2 billion CIVIL SOCIETY 1 MEDIA Catalyst injects $2 billion annually into the economy. NON-PROFIT ORGANIZATIONS 1 Estimated using British Columbia Provincial Economic Multipliers (BC Stats) to include both direct and indirect benefits and jobs. ENVIRONMENTAL GROUPS CATALYST PAPER 2013 SUSTAINABILITY REPORT 5 continents PUBLISHERS Our customers can be found on five continents, and our products pass through the hands of people around the world. Books (academic) Magazines (retail) News PRINT ADVERTISERS HALALT (retail) CUSTOMERS TSESHAHT COMMERCIAL PRINTERS SLIAMMON ABORIGINAL COWICHAN TRIBES PENELAKUT FIBRE SUPPLIERS HUPACASATH SUPPLIERS + BUSINESS PARTNERS INSURERS BC HYDRO REGULATORS BC Ministry of Environment Securities Commission BC Pension Corporation FEDERAL MPS 7,000 1 GOVERNMENT Catalyst supports 7,000 jobs. PROVINCIAL Premier BC Cabinet Ministers BC MLAs MUNICIPAL CATALYST PAPER 2013 SUSTAINABILITY REPORT Mayors Councils 19 PRESERVING THE GREAT BEAR RAINFOREST 20 Following controversy in the B.C. forest sector in the mid-1990s, Catalyst joined forces with other forest products companies and leading environmental groups to work collaboratively to devise a protection plan for the Great Bear Rainforest, one of the largest tracts of intact temperate rainforests in the world and an area renowned for its biodiversity. The Joint Solutions Project (JSP) was formed in 2000 to collaborate on land use planning and technical analysis. It delivered key input for the 2006 and 2009 Great Bear Rainforest Agreements, subsequently endorsed by the B.C. government and the region’s First Nations. In January 2014, the JSP made a series of recommendations to the provincial government and First Nations for final implementation of the Agreements to ensure low ecological risk to the rainforest while supporting a viable economy for regional communities. Decisions as to whether the recommendations will be accepted rest with the provincial and First Nations governments. NEW RULES FOR LOGGING Key components of the conservation plan include designating one third of the region as protected areas (2.1 million hectares) and implementing a new forest practice called Ecosystem Based Management (EBM). EBM is a science-informed, world-leading forest management regime that ensures the co-existence of healthy ecosystems and human communities. By definition, EBM is an adaptive process that evolves to reflect new understanding and knowledge. The forest products companies within JSP are also FSC-certified for part of their operations in the Great Bear Rainforest. CONSERVATION TARGETS The recommendations of the JSP, building on the conservation achieved to date, address the scope of future logging along B.C.’s central and north coasts, and increase the level of conservation by approximately 500,000 hectares to support ecological “low risk”. The recommendations are part of a five-year implementation review of EBM and will now be evaluated by the Province, Nanwakolas Council and the Coastal First Nations – Great Bear Initiative, as well as 12 other First Nations who have traditional territories in the Great Bear Rainforest. It is the hope of the Joint Solutions Project that the recommendations will be accepted (or equivalent provisions enacted) by decision-makers in the coming months in order to bring this long-running, solutions-oriented project to a successful conclusion all parties can be proud of. For more information, please visit the Coast Forest Conservation Initiative at www.coastforestconservationinitiative.com 1/3 1/3 of the region in protected areas = 2.1 million hectares Area the size of West Virginia Some of the world’s richest ecosystems and home to the unique Spirit Bear CATALYST PAPER 2013 SUSTAINABILITY REPORT The 64,000 square kilometre Great Bear Rainforest is the traditional territory of 27 First Nations and home to the Kermode, or Spirit Bear. “Once fully implemented, the Great Bear Rainforest will be one of the most protected forest regions in the world. We are confident that we will be able to finalize outstanding steps to achieve our long-term goals of full ecosystem health and thriving local communities in the very near future.” JENS WIETING, SIERRA CLUB BC “A vision born from environmental and economic necessity is becoming a reality on Canada’s west coast. It’s a conservation model that other parts of the world can look to and build on, a model that shows how protection of ecological values and enhancement of human well-being based on progressive social values can be advanced without undermining each other.” EDUARDO SOUSA, GREENPEACE CATALYST PAPER 2013 SUSTAINABILITY REPORT “If everyone remains committed to the goals and follows through, this astoundingly rich coastal ecosystem will continue to support iconic species like the Spirit Bear, the conservation of massive carbon storehouses in thousand-year-old trees and a bright future for the First Nations communities.” VALERIE LANGER, FORESTETHICS SOLUTIONS 21 ENGAGING EMPLOYEES 22 51% SAY 58% 49% Recommend Catalyst to a friend seeking employment Successful companies recognize that hat cess. people are the cornerstone of success. At Catalyst, we strive to retain our existing employees and attract the best and d brightest when making new hires. We had good success in 2013: hiring ing 178 new employees and improving g on, or maintaining, employee engagement ment sured for four recognized indicators measured in our annual employee survey. 49% 59% Tell others great things about working here 52% 96% 96% STAY STRIVE I rarely think of leaving to work elsewhere Aim to do my best work every day Catalyst Score 2012 Catalyst Score 2013* * Agree and strongly agree HOW CAN WE ATTRACT PEOPLE? EOPLE? As we reported last year, the challenge enge facing Catalyst is that about three-quarters of our workforce will d of time when competition for skilled labour will remain high. In 2013, retire in the next 10 years, a period we launched initiatives focussed on succession planning and talent management, and retained external consultants to audit our recruitment process. In 2014, we will implement Opportunities for Improvement (OFI), giving employees an opportunity to provide their ideas for optimizing performance and reducing costs. Three ways in which we will continue to attract talent 1 OUR RECORD OF SUSTAINABILITY PERFORMANCE: Seven consecutive years on Corporate Knight’s Best 50 Corporate Citizens of Canada. 2 CREATING OPPORTUNITY AND CHALLENGE: At Catalyst, employees can change careers while staying at the same company. 3 PROMOTING THE WEST COAST LIFESTYLE: Whether you work in one of the coastal communities that host our mills or in Greater Vancouver at our head office or Surrey Distribution Centre, we live and work where most people want to vacation. CATALYST PAPER 2013 SUSTAINABILITY REPORT HOURLY EMPLOYEES AGE 40 + YOUNGER 91 :END OF 2011 163 :END OF 2012 240 :END OF 2013 23 178 Of 178 positions filled in 2013, 21 successful placements resulted from our employee referral program. AGE CURVE OF EMPLOYEES 33 22 11 0 Ages 20-44 45-49 50-54 55-59 60-69 SALARY EMPLOYEES Percentage of Salary Employees by Age 33 12 25 18 12 SALARY EMPLOYEES Percentage of Hourly Employees by Age 26 12 24 28 10 I pledge to always put safety before production and make sure that I look out for my colleagues. TANNER MCQUARRIE Labour Printing Papers CATALYST PAPER 2013 SUSTAINABILITY REPORT 6.8% :2011 10.9% :2012 7.0% :2013 HUMAN RESOURCES DATA TABLES OVERALL TURNOVER 24 EMPLOYEES BY LOCATION UNIONS + MEMBERSHIP (number of employees) POWELL RIVER Canadian Operations Canadian Office and Professional Employees Union Unifor Pulp, Paper and Woodworkers of Canada 2 441 employees $46 million 60 new employees PORT ALBERNI (year-end 2013) 324 employees $36 million 43 new employees PAYROLL BY LOCATION SURREY DISTRIBUTION CENTRE (full year 2013) 807 36 employees $4 million 1 new employee 383 Includes active employees at year-end. 74% OF CATALYST EMPLOYEES ARE REPRESENTED BY UNIONS 86 employees $7 million 11 new employees NANAIMO CROFTON 13 employees and $4 million TOTAL EMPLOYEES + PAYROLL 2013 2012 2011 2010 2009 Workforce 1,611 1,592 1,877 1,803 1,851 133 employees $19 million 8 new employees 578 employees $67 million 55 new employees U.S. SALES OFFICES Year RICHMOND TURNOVER SUMMARY, CANADIAN WORKFORCE Payroll ($ millions) $ $ $ $ $ 183 206 250 246 247 Workforce figures are for active employees at year-end and exclude vacancies; payroll figures are inclusive of benefits and exclusive of restructuring costs (severance). HOURLY 2011 2011 2012 2012 2013 Retirement 3.5% 4.9% 3.7% Voluntary Departure 1.9% 4.7% 2.6% Total 5.4% 9.6% 6.3% SALARY 2011 2012 2013 Retirement 5.2% 1.4% 2.2% Voluntary Departure 5.2% 12.8% 6.8% 10.4% 14.2% 9.0% Total Turnover rate is the number of employees either retiring or voluntarily leaving employment during the year, as a percentage of the total Canadian workforce at the end of 2013. TOTAL WORKFORCE RCE: ES 1,611 EMPLOYEES TOTAL PAYROLL: $183 MILLION CATALYST PAPER 2013 SUSTAINABILITY REPORT 2011: 2.41 2012: 2.53 2013: 2.38 PULP + PAPER INDUSTRY AVERAGE MI RATES 25 INJURIES HOW MANY HOW SEVERE HOW OFTEN 140 180 6 100 140 4 60 100 2 20 60 0 09 10 11 12 09 13 Number of Incidents Requiring Medical Attention (MIs) 81 90 72 73 61 2013 Target: 33 10 11 12 Average Number of Work Days Lost Due to Injuries 157.5 112.9 171.0 94.9 2013 Target: 51.0 13 83.4 Number of Incidents Resulting in Lost Time From Work (LTIs) 40 48 30 31 22 2013 Target: 17 09 10 11 12 13 MIs per 200,000 Hours Worked 4.28 5.09 4.15 4.04 2013 Target: 2.18 3.84 LTIs per 200,000 Hours Worked 2.11 2.71 1.73 1.71 2013 Target: 1.12 1.39 Prior-year figures have been updated to reflect post year-end adjustments, including injuries that resulted in missed work on a delayed basis due to longer term injury progression or surgical wait times. SAFETY BEST PRACTICE In our 2013 survey, 95 per cent of employees confirmed their belief that working safely is a personal responsibility, and, while injury severity rates decreased in 2013, incidents requiring medical attention and lost time injuries remained too high. This tells us we need to continue to focus on fundamental safety values: preventing injuries and ensuring a safe workplace. One facility where the safety performance has fully met expectations is the Surrey Distribution Centre (SDC). With 75 material handlers on lift trucks moving loads of up to four metric tonnes, there is potential for serious injury; yet, the SDC CATALYST PAPER 2013 SUSTAINABILITY REPORT team has had no lost time injuries for over 14 months. In 2013, the SDC team introduced an annual safety and best practices workshop attended by every hourly worker. Each session had a maximum of eight participants, and these small groups allowed each employee’s comments to be heard. The workshops covered Occupational Health and Safety (OHS) regulations, safety values and policies, injury identification and trends, as well as an analysis of current work practices and opportunities for improvement. The workshops were well received and yielded many suggestions that have been implemented. At the SDC, flashing blue and red lights serve as communication between tuggers and pickers to signify occupation of a high traffic aisle, eliminating the risk for injury caused by collision. CREATING COMMUNITY VALUE 26 At Catalyst, we collaborate with the regions that host our operations, investing in people and contributing to healthy and sustainable communities. In 2013, our operations injected (directly and indirectly) $2 billion to the provincial economy and supported 7,000 jobs. All operations actively pursue opportunities to create local shared value through initiatives such as cooperation and capacity building protocols with the Tla’amin First Nation, and the sale of non-core assets. In 2013, we sold our wastewater treatment facility to the City of Port Alberni for $5.8 million. The sale included the 13.4-hectare wastewater treatment facility and a 3.9-hectare parcel of land for an industrial truck route along the waterfront. Our employees live in the communities where they work. From donations to in-kind contributions and volunteer service, we are proud of the efforts they make to weave Catalyst into the fibre of the community. In 2013, Catalyst and its employees raised or donated $136,000 to a variety programs, including youth organizations and community groups. We also provide scholarships for study at the University of British Columbia and the British Columbia Institute of Technology, and support the co-op work program at California Polytechnic State University and the University of Victoria. TOTAL SPENDING WITH B.C. VENDORS ($ million) 80.0 80.7 404.5 LOWER MAINLAND VANCOUVER ISLAND REST OF B.C. TOTAL $565.2 TO SUPPORT CONTINUOUS IMPROVEMENT, WE TRACK COMPLAINTS FROM OUR NEIGHBOURS We track complaints, by source, location and time of year, to help optimize our operations and understand any impacts we might have on our neighbours. TOTAL COMPLAINTS BY SITE 2013 Odour Noise Particulate Other* Port Alberni 2 5 0 0 7 Crofton 7 1 5 3 16 12 7 0 19 38 21 13 5 22 61 Powell River TOTAL Total *Includes concerns that proved not to be associated with mill operations. CATALYST PAPER 2013 SUSTAINABILITY REPORT 27 In Port Alberni, scrap metal from the Catalyst mill will find new life in local sculptor Kevin Wright’s uptown industrial art project. Wright, who owns the SteamPunk Café and Coffee House, described the donation as “priceless” (photo courtesy of Julie Bertrand, Alberni Valley Times). CATALYST PAPER 2013 SUSTAINABILITY REPORT To conserve natural habitat for wildlife and recreation, Catalyst employees from all three mills, the Surrey Distribution Centre, and Richmond head office participated ipated in the 2013 Great Canadian Shoreline line Cleanup events in their community. munity. The efforts support a conservation rvation initiative of the Vancouver Aquarium rium and the World Wildlife Fund of Canada. Congratulations to the Powell River Peak. The newspaper’s special section “100 Years of Papermaking” finished second in the Canadian Community Newspaper Association Better Newspapers Awards. PAPER 28 CATALYST PAPER 2013 SUSTAINABILITY REPORT Catalyst is the largest producer of mechanical printing papers in western North America OUR BUSINESS IS COMPRISED OF THREE SEGMENTS 1 Specialty printing papers, including coated mechanical, uncoated mechanical and directory paper 2 Newsprint 3 NBSK pulp, marketed primarily in Asia OUR FOCUS OUR HIGHLIGHTS Expanding geographic reach of Catalyst Paper into emerging world markets of Latin America and Asia. Increased market share in both coated and newsprint and maintained market share in uncoated paper. Gaining market share and expanding sales in new markets with new products. Pulp sales maintained focus on freight logical Asian markets. Matched orders and production to keep paper machines running at capacity. Increasing our product range and solidifying our position as the most flexible and diverse producer and marketer of paper in the West. Successfully launched Ascent, coated three grade paper. Increased sales of Marathon Lite 40 gsm newsprint, offering cost savings and environmental advantages while maintaining the performance of a heavier sheet. Increased sales to strategic Latin American customers. 45 coastal = trees CATALYST PAPER 2013 SUSTAINABILITY REPORT lumber for typical family home + 10 tonnes of paper + enough derived electricity to power the same family home for six months 29 BEING SAGE ABOUT SUSTAINABILITY 30 SAGE Noun: someone venerated for the possession of wisdom, judgment, and experience. Adjective: wise, judicious, or prudent. When we launched Sage, the greenest of our specialty papers and one that embodies our decades-long commitment to environmental sustainability practices, our objective was to create a product that would set the industry standard for environmentally responsible paper manufacturing. To accomplish this goal, we knew Sage paper would have to offer the highest quality, reliability and excellent press performance. We also wanted to ensure it offered a verifiable environmental pedigree and chain-ofcustody system. paper sales and six per cent of total paper sales, proving the paper delivers on its promise and that there is room for continued growth. In 2013, three years after introduction, sales of Sage were almost 70,000 tonnes. Our top five Sage customers, which includes Rolling Stone Magazine, represent 77 per cent of total Sage sales; Sage sales are 11 per cent of all specialty We are proud to produce a product that embodies our holistic sustainability philosophy: doing well by managing resource consumption, emissions footprint, and social impacts while generating and distributing economic value. CATALYST PAPER 2013 SUSTAINABILITY REPORT 31 THE SAGE WAY: INFORMED CHOICES, HAPPIER STAKEHOLDERS, HEALTHIER PLANET 100 per cent fibre from sustainably well managed forests in the Pacific North West SFI*, PEFC or FSC chain of custody labeling Manufactured carbon neutral using standards set by the International Organization for Standardization (ISO) and a diverse basket of certified carbon offsets 90 per cent of the energy used to make Sage papers is renewable – such as hydroelectric power and waste bark energy sources – limiting greenhouse gases Produced in some of North America’s cleanest, low impact paper mills with state-of-the-art air and wastewater treatment systems Transparency provided through GreenBlue’s Environmental Paper Assessment Tool (EPAT) Light weight paper grades with excellent printability and run-ability saves our customers time and money $1 per Sage tonne sold goes to support our partners’ sustainability initiatives * Sustainable Forestry Initiative, www.sfiprogram.org CATALYST PAPER 2013 SUSTAINABILITY REPORT PERFORMANCE 32 DID YOU KNOW We have been able to reduce the weight of our paper by 10-15 per cent without losing opacity? The resulting weight-to-cost savings in postage and distribution efficiencies help reduce our customers’ carbon footprint. CATALYST PAPER 2013 SUSTAINABILITY REPORT MATERIALITY ISSUES + INTERESTS 33 The views of stakeholders inform our sustainability approach. We use a variety of methods and mediums to hear – and learn – from stakeholders. From employee surveys to quarterly investor calls, from one-to-one meetings with elected officials and regulators to community advisory panels, from media tracking and analysis to participation in industry events and committees, and from environmental audits and a detailed risk register to Board of Director reports and electronic feedback mechanisms, a list of interests common to stakeholders and Catalyst’s business strategy evolved. ECONOMIC VALUE GENERATED + DISTRIBUTED (EVG+D) FINANCIAL PERFORMANCE MARKET SHARE + PRODUCT ECONOMIC HEALTH + SAFETY CARBON FOOTPRINT/ ENERGY SOCIAL ENVIRONMENTAL INNOVATION EMISSIONS COLLABORATION RENEWABLES / RECYCLABLES PUBLIC POLICY CONSUMPTION + CONSERVATION COMPLIANCE CATALYST PAPER 2013 SUSTAINABILITY REPORT COMPLIANCE OUR MILL HIGHLIGHTS 34 At each of our mills, performance improvements addressed local interests and issues identified by annual performance audits and our ISO 14000 systems. POWELL RIVER CROFTON PORT ALBERNI • In 2012, elevated GHG emissions were one of the byproducts from the startup of the G12 project that increased power generation at the site. The mill identified the higher-than-expected natural gas usage and undertook performance improvements in the operating strategy of the mill’s hog fuel fired power boiler, changes that saw GHG emissions return to more normal levels in 2013 from the year previously. • Crofton has the province’s most stringent chlorine dioxide emission limits since an amendment limiting its A and B bleach plant stack emissions to 10 parts per million (ppm) was implemented. In 2013, to improve the mill’s performance, an innovative new process was started that combines odorous pulping gases and bleach plant emissions, causing the elimination of both streams. The system is scheduled for completion and startup in Q2 2014. • In 2013, the mill was 100 per cent permit compliant. • To improve the robustness of the wastewater collection system, the mill installed a series of standby diesel power generators at strategic lift stations around the mill’s effluent handling system to further improve the backup power supply to these pumps. • The mill operates under the most stringent BOD limits set by the provincial Ministry of Environment, which are significantly lower than any other pulp or paper mill in the province. The tight discharge limits are just within the capability of the mill’s effluent treatment system, so the company is exploring a number of options to provide a wider operating window for current and future operations. • In October, the new fully engineered landfill at Powell River began receiving waste sand and flyash from the mill’s power boiler and other miscellaneous material from the mill. • The mill achieved a 17 per cent reduction in absolute GHG emissions from 2012 levels. • Routine monitoring of landfill groundwater detected levels of salt water (sodium chloride) which our independent engineering experts attributed to seawater infiltration. Based on their suggestions, we undertook testing of groundwater from seven residential wells in the area in August 2013, which showed no detectable salt levels. By the end of Q2 2014, the mill will install an additional test well in the area to confirm seawater infiltration as the source. • The air system for the #4 power boiler, which burns hog fuel/biomass with low natural gas use, was upgraded to improve combustion control and boiler efficiency. Annual power boiler dioxin test results showed 0.05 ng/m3 (low) versus Canada Wide Standard 0.5 (or 0.1 for new boilers). • Continued high production in our chemithermomechanical pulping (CTMP) plant required increased use of cold water to control the effluent temperature going to the biological treatment system. This increased overall mill water use in 2013. • Dry weather dust generation on the active wood ash landfill can be problematic. In 2013, we implemented a new operation strategy for dust suppression, which includes modifying waste hauling methods to prevent dust from becoming airborne during dry summer months. CATALYST PAPER APER 2013 SUSTAINABILITY REPORT VALUE DISTRIBUTED ($ millions) 35 EMPLOYEES (WAGES + BENEFITS) GOVERNMENTS (TAXES) Canada: $179 U.S.: $4 Total: $183 Total: $27 SHAREHOLDERS SOCIETY (DONATIONS) EMPLOYEES + SOCIETY Total: $0.13 TOTAL DIRECT VALUE DISTRIBUTED $1,100 GOVERNMENTS, CREDITORS, SHAREHOLDERS Total: $37 SUPPLIERS + BUSINESS PARTNERS CAPITAL PROJECTS FIBRE + OTHER RAW MATERIALS Total: $23 Total: $289 ENERGY Total: $185 “Taxes” include property taxes, B.C. carbon tax. “Benefits” include employer contributions to pension and other benefit plans. CATALYST PAPER 2013 SUSTAINABILITY REPORT CREDITORS (INTEREST PAYMENTS) OTHER PURCHASES Canada: $355 U.S.: $1 Total: $356 RESPONSIBLE OPERATIONS MEASURE PERFORMANCE 36 COMMUNITY BENEFITS (excludes closed operations and U.S. sales offices) MOVING PRODUCT TO MARKET DISTRIBUTION YIELD BY MODE CROFTON Jobs1 578 Wages + Benefits ($ millions) $67 Local Property Taxes2 ($ millions) 3 Spending with Local Vendors ($ millions) $4 $12 PORT ALBERNI RAIL (tonnes/car) TRUCK (tonnes/truck) CONTAINER 324 Jobs1 Wages + Benefits ($ millions) 2 Local Property Taxes ($ millions) 3 Spending with Local Vendors ($ millions) $4 $10 441 Wages + Benefits ($ millions) Local Property Taxes ($ millions) $3 Spending with Local Vendors3 ($ millions) $8 36 Spending with Local Vendors3 ($ millions) 2010 2009 75.7 74.4 74.0 73.4 73.6 25.6 26.1 26.3 26.7 26.3 98.1 98.2 97.4 96.8 97.0 The reduction in truck yield was a function of destination mix and road limits. CUSTOMERS (complaints received) (claims paid, $ millions) 1800 2.4 1200 1.6 600 0.8 0 0 09 NANAIMO Wages + Benefits ($ millions) 2011 $46 2 Jobs1 2012 $36 POWELL RIVER Jobs1 (% utilized) 2013 $4 10 11 12 13 Customer Complaints Received 1,111 992 1,642 1,576 Claims Paid ($ millions) 1.35 1.42 2.12 1.50 1,323 1.15 $45 RICHMOND 133 Jobs1 Wages + Benefits ($ millions) $19 3 $26 Spending with Local Vendors ($ millions) SURREY Jobs1 86 Wages + Benefits ($ millions) $7 Spending with Local Vendors3 ($ millions) $46 100% Port Alberni: 100 per cent permit compliance 1 Active at December 31, 2013. 2 Includes provincial levies. 3 Includes only vendors with addresses in the local municipality (restricted to Crofton/Chemainus in the case of Crofton). CATALYST PAPER 2013 SUSTAINABILITY REPORT WOOD FIBRE 37 WATER FIBRE ORIGIN (CHIPS + LOGS) Highlights Highlights (% 2013) • 56 percent of fibre deliveries to mills FSC and PEFC certified • Continued to voluntarily report to the Forest Footprint Disclosure Project (www.forestdisclosure.com) on fibre use • 4 38 58 In 2013, we joined the Sustainable Forestry Initiative (SFI). The SFI program’s unique fibre sourcing requirements promote responsible forest management on all suppliers’ lands • Water use was virtually identical to 2012. This is attributable to reductions at Crofton which were offset by small increases at Powell River and Port Alberni. Port Alberni saw high production in its CTMP plant which required increased use of cold water to control the temperature of effluent going to biological treatment. TOTAL WATER DISCHARGES (million m3/year) B.C. COAST (m3/adt) 130 90 100 80 70 70 40 60 B.C. INTERIOR U.S. PACIFIC NORTHWEST FIBRE CERTIFICATION 1 FIBRE USAGE BY TYPE (% 2013) (% 2013) 09 1 12 12 13 Absolute (million m3/year) 93 106 109 10 11 106 106 Intensity (m3/adt) 67 77 73 74 76 44 Consistent with standard industry practice, we track our water use based on treated effluent discharges. 55 adt – Air-dried tonnes of product 88 PEFC CERTIFIED VIRGIN FIBRE SAWMILL WOOD CHIPS UNCERTIFIED FIBRE PULP LOGS FSC VIRGIN FIBRE 1 Certified fibre breakdowns are based on percentages of certified raw fibre delivered during the year, applied to mill usages. Does not include certified purchased pulps. CATALYST PAPER 2013 SUSTAINABILITY REPORT 38 ENERGY TOTAL FUEL ENERGY USE Highlights • • TOTAL ELECTRICITY USE (millions of GJ/year) Port Alberni recorded the highest renewable energy content in the mill’s history with 91 per cent of energy consumed coming from renewables Powell River returns renewable content to 93 per cent following a poor result in 2012, attributable to startup of the power generator project (GJ/adt) (millions of MWh/year) (MWh/adt) 45 45 4.5 4.5 30 30 3.0 3.0 15 15 1.5 1.5 0 0 0 0 09 10 11 Absolute (million GJ/year) 19.6 26.4 29.3 Intensity (GJ/adt) 19 19 20 12 31.8 13 30.1 22 21 The shaded portion above represents renewable fuels (biomass); the rest is fossil fuels. 12 13 Absolute (million MWh/year) 3.5 3.5 3.6 09 10 11 3.6 3.5 Intensity (MWh/adt) 2.5 2.6 2.5 2.4 2.4 The shaded portion above represents selfgenerated electricity; the rest is purchased. adt – Air-dried tonnes of product ENERGY MIX + RENEWABILITY Breakdowns based on net energy use and accounting for use of some fuel energy to self-generate electricity. (% 2013) 8 Corporate Wide Total Energy Use: 40.7 Million GJ Intensity (28.2 GJ/adt) { FOSSIL FUELS 26 ELECTRICAL ENERGY 92% Renewable BIOMASS FUELS 66 100% Renewable 90% TOTAL RENEWABLE Electricity Sales (Powell River) 97,270 MWh CATALYST PAPER 2013 SUSTAINABILITY REPORT AIR PARTICULATE SOLID WASTE TOTAL PARTICULATE TOTAL WASTE GENERATION (tonnes/year) (kg/adt) 600 0.9 400 0.6 200 0.3 0 0 09 39 11 12 13 Absolute (tonnes/year) 243 480 408 10 467 464 Intensity (kg/adt) 0.17 0.35 0.32 0.32 0.28 All figures based on actual test results; NPRI data (see page 47) may differ because it uses emission factors and can include other sources. Disposition Flyash Grate ash, sand 1 Dregs & grits Scrap metal Waste oil Effluent treatment sludges Paper residuals Other/miscellaneous Total 1 2 adt – Air-dried tonnes of product Weight (t) % Landfilled % Recycled or other 41,902 14,102 14,808 626 197 74,864 469 2,777 100% 100% 100% 0% 0% 0.6% 0% 100% 0% 0% 0% 100% 100% 99.4% 2 100% 0% 149,745 50% 50% Powell River set up an internal reuse process for sand (used in power boilers) in late 2011. It had previously been sent offsite to a waste management company and a portion was recycled and a portion returned to the mill for reuse. The remaining waste material is sent to the landfill. Incineration (energy recovery). Includes all waste generated at Catalyst’s operating production facilities. Highlights SOLID WASTE TO LANDFILL (thousands of m3/year) • • First use of the expanded fully engineered landfill at Powell River Crofton was successful in controlling landfill dust by modifying their ash hauling process (m3/adt) 150 .09 100 .06 50 .03 0 0 09 10 11 12 85.8 Intensity (m3/adt) 0.06 0.05 0.06 0.06 0.06 adt – Air-dried tonnes of product CATALYST PAPER 2013 SUSTAINABILITY REPORT 13 Absolute (thousands of m3/year) 85.8 72.3 83.4 84.3 40 CARBON FOOTPRINT 2013 GHGS BY SCOPE (Tonnes CO2e) MANUFACTURING RAW MATERIALS CATALYST PRODUCTS GHGs produced directly by our operations (scope 1) and associated with purchased electricity (scope 2) GHGs associated with the production and transportation to us of key raw materials (scope 3, estimated) GHGs associated with transportation of our products to customers (scope 3, estimated) 206,365 tonnes 144,483 tonnes 35,832 tonnes 70,074 tonnes SCOPE 3 Harvesting & Sawmilling SCOPE 3 Transport to Catalyst SCOPE 3 Transport to Customers SCOPE 1 26,683 tonnes SCOPE 2 Highlights • • • • Port Alberni’s GHG emissions of 92 kg CO2e per tonne of paper is one of the lowest in North America’s paper sector Powell River saw a 47 per cent reduction in absolute GHGs from 2012 Our 2013 average GHG emissions of 149 kg CO2e per tonne of paper is amongst the lowest in all of North America in the paper sector The closure of our Snowflake facility in 2012 resulted in an elimination of 589,000 tonnes per year in carbon emissions (chips, logs, biomass fuel) DIRECT GHG EMISSIONS (SCOPE 1) INDIRECT GHG EMISSIONS (SCOPE 2) Canadian operations only. Canadian operations only. (paper only) (kg CO2e/adt) (thousand tonnes CO2e/year) 360 1990 Baseline = 1,383 1990 Baseline = 574 (kg CO2e/adt) (thousand tonnes CO2e/year) 360 150 60 240 240 100 40 120 120 50 20 0 0 0 0 09 10 11 12 13 09 10 11* 12* 13 Absolute (thousand tonnes CO2e/year) 213 204 217 289 215 Absolute (thousand tonnes CO2e/year) 78 69 29 27 27 Intensity (kg CO2e/adt) 153 148 151 Intensity (kg CO2e/adt) 56 50 20 18 169 149 18 * Revised BC Hydro estimates of 9 kg CO2e/MWh GHG emissions (Scopes 1 and 2) are reported based on measurement and calculation methodologies consistent with the ISO 14064-1 standard and with the World Resources Institute / World Business Council for Sustainable Development Greenhouse Gas Protocol. While these are among the most widely applied methodologies globally, they differ from those specified for the purposes of separate reporting to the British Columbia provincial government. Scope 3 emissions are estimated with reference to supply-chain research conducted in cooperation with the University of British Columbia and World Wildlife Fund of Canada. CATALYST PAPER 2013 SUSTAINABILITY REPORT THE RESULTS: ENVIRONMENTAL DATA Historical figures represent Canadian operations only. 41 CATALYST PAPER 2013 SUSTAINABILITY REPORT QUALITY PERFORMANCE 42 WATER TOTAL TSS – TOTAL SUSPENDED SOLIDS TOTAL AOX 1 – ADSORBABLE ORGANIC HALIDES (thousands of tonnes/year) (kg/adt) (tonnes/year) TOTAL BOD 2 – BIOCHEMICAL OXYGEN DEMAND (kg/adt) (thousands of tonnes/year) (kg/adt) 6 2.4 360 0.9 3 0.9 4 1.6 240 0.6 2 0.6 2 0.8 120 0.3 1 0.3 0 0 0 0 0 0 09 10 11 12 Absolute (thousands of tonnes/year) 1.6 1.9 1.9 2.0 Intensity (kg/adt) 1.2 1.4 1.3 1.4 13 09 10 11 2.3 Absolute (tonnes/year) 48 117 147 1.6 Intensity (kg/adt) 0.46 0.39 1 0.40 12 145 0.39 13 09 10 11 12 163 Absolute (thousands of tonnes/year) 0.6 0.6 1.0 1.0 0.44 Intensity (kg/adt) 0.35 0.39 Relevant at Crofton only 0.57 0.58 13 1.2 0.81 adt – Air-dried tonnes of product 2 2013 BOD discharges from Crofton were elevated compared to past years. The mill is actively investigating the cause. AIR TOTAL DIOXIN AND FURAN RELEASES 3 TOTAL SULPHUR OXIDES 3 (grams/year) (mg/adt) TOTAL TRS 3 – TOTAL REDUCED SULPHUR (thousands of tonnes/year) (kg/adt) (tonnes/year) (kg/adt) 90 0.03 7.5 3.6 240 0.3 60 0.02 5.0 2.4 160 0.2 30 0.01 2.5 1.2 80 0.1 0 0 0 0 0 0 09 10 11 Absolute (grams/year) 20.0 26.3 41.2 Intensity (mg/adt) 0.019 0.029 0.019 12 27.8 0.019 13 20.2 0.014 Results are heavily influenced by factors such as operating conditions and fuel characteristics and are often highly variable. All operation-specific emissions in 2013 were below a 0.1 ng/m3 TEQ Canadian federal standard applicable to power boilers installed since 2001 (even though all Catalyst boilers predate 2001). 09 10 11 12 Absolute (thousands of tonnes/year) 1.1 2.2 2.5 2.3 Intensity (kg/adt) 0.8 1.6 1.7 1.6 13 11 12 13 3.1 Absolute (tonnes/year) 17 61 91 78 77 2.1 Intensity (kg/adt) 0.16 0.20 0.20 0.21 See discussion of operation-specific results on page 43. Environmental metrics are shown in both absolute (amount per year) and intensity (amount per day or per tonne of production) terms. 09 10 0.23 Relevant at Crofton only. 3 All figures based on actual test results; NPRI data (see page 47) may differ because it uses emission factors and includes other sources. adt – Air-dried tonnes of product TEQ – Dioxin equivalent units CATALYST PAPER 2013 SUSTAINABILITY REPORT AIR EMISSIONS (BY MILL) 43 Crofton Total GHGs as kg CO2e/year (scope 1/direct) Total GHGs as kg CO2e/adt (scope 1/direct) Total GHGs as kg CO2e/year (scope 2/indirect) Total GHGs as kg CO2e/adt (scope 2/indirect) Particulate matter kg/day Particulate matter kg/adt Sulphur Oxides kg/day 1 Sulphur Oxides kg/adt TRS kg/day TRS kg/adt Power Boiler dioxin ng/m3 TEQ Ambient TRS % compliance A level 24 hr average Ambient PM 2.5 average, ug/m3 2 Port Alberni Total GHGs as kg CO2e/year (scope 1/direct) Total GHGs as kg CO2e/adt (scope 1/direct) Total GHGs as kg CO2e/year (scope 2/indirect) Total GHGs as kg CO2e/adt (scope 2/indirect) Particulate matter kg/day Particulate matter kg/adt Sulphur Oxides kg/day Sulphur Oxides kg/adt Power Boiler dioxin ng/m3 TEQ Ambient PM 2.5 average, ug/m3 2 Powell River Total GHGs as kg CO2e/year (scope 1/direct) 3 Total GHGs as kg CO2e/adt manufactured paper (scope 1/direct) 3 Total GHGs as kg CO2e/MWh sold electricity (scope 1/direct) Total GHGs as kg CO2e/year (scope 2/indirect) Total GHGs as kg CO2e/adt (scope 2/indirect) Particulate matter kg/day Particulate matter kg/adt Sulphur Oxides kg/day Sulphur Oxides kg/adt Power Boiler dioxin ng/m3 TEQ Ambient TRS % compliance A level 24 hr average Ambient PM 2.5 average, ug/m3 2 1 2 Crofton’s SO2 emissions were up compared to past year. The mill is currently investigating the recovery boilers as a cause. There are multiple sources of particulates and ambient levels do not necessarily correlate closely. CATALYST PAPER 2013 SUSTAINABILITY REPORT 3 2013 2012 2011 2010 2009 135,050,000 196 9,419,000 14 1,180 0.61 6,882 3.65 212 0.210 0.02 84.9 4.2 162,266,000 236 9,456,000 14 1,120 0.56 5,436 2.76 214 0.200 0.01 80.0 7.5 139,466,000 205 10,159,000 15 1,085 0.54 5,935 3.00 249 0.230 0.03 84.5 4.5 140,582,000 236 29,845,000 50 1,280 0.78 5,331 3.24 166 0.197 0.03 95.3 4.8 112,063,000 242 29,382,000 63 565 0.43 2,329 1.79 115 0.164 0.02 97.3 4.8 28,693,000 92 6,499,000 21 21 0.024 512 0.59 0.05 8.1 28,771,000 89 6,844,000 21 23 0.025 427 0.46 0.03 6.3 35,490,000 114 6,770,000 22 20 0.021 554 0.60 0.03 7.9 39,699,000 126 22,037,000 70 28 0.030 526 0.56 0.07 – 37,988,000 130 19,554,000 67 32 0.036 484 0.54 0.09 – 51,379,000 97 97,470,000 126 42,166,000 95 23,694,000 51 42,116,000 92 100 351 N/A N/A N/A 10,765,000 24 69.5 0.05 365 0.268 0.18 95.1 1.8 10,497,000 23 138 0.4 452 0.347 0.02 97.8 1.5 11,239,000 25 13.1 0.01 302 0.233 0.05 98.9 1.5 17,312,000 37 7.3 0.01 134 0.103 0.02 93.4 1.9 23,505,000 51 54 0.04 313 0.242 0.07 94.2 2.5 Powell River’s carbon footprint is substantially lower than 2012 due to reduced natural gas firing in PB19 in 2013. adt – Air-dried tonnes of product ng – Nanogram PM – Particulate matter TEQ – Dioxin equivalent units ug – Microgram A complete glossary of terms and definitions is available at www.catalystpaper.com/ products/glossary. EFFLUENT + SOLID WASTE 44 EFFLUENT (BY MILL) 2013 2012 2011 2010 2009 Crofton TSS kg/day TSS kg/adt BOD kg/day 1 BOD kg/adt AOX kg/day AOX kg/adt pulp 2378TCDD ppq 2378TCDF ppq Trout toxicity % compliance 3,541 1.9 1,850 0.98 446 0.41 n/d n/d 95 3,045 1.7 1,464 0.78 396 0.32 n/d n/d 96 2,889 1.6 1,726 0.92 403 0.33 n/d n/d 94 2,259 1.4 831 0.51 321 0.32 n/d n/d 100 1,373 0.9 530 0.44 322 0.46 n/d n/d 100 Port Alberni TSS kg/day 2 TSS kg/adt BOD kg/day 2 BOD kg/adt Trout toxicity % compliance 905 1.1 410 0.48 100 693 0.8 410 0.46 100 412 0.5 280 0.33 100 414 0.5 270 0.31 100 380 0.5 190 0.23 100 Powell River TSS kg/day TSS kg/adt BOD kg/day 3 BOD kg/adt Trout toxicity % compliance 1,909 1.6 956 0.79 98 1,822 1.5 786 0.63 98 1,885 1.5 705 0.57 94 1,718 1.4 661 0.52 98 1,483 1.0 652 0.44 98 1 2 3 Crofton’s daily BOD loading has increased compared to past years and the mill is actively investigating the cause. Total suspended solids (TSS) at Port Alberni increased to 905 kg/day from 693 kg/day in 2012. Following the sale of the mill’s water treatment lagoon to the City of Port Alberni, the mill is using a smaller plant. While this resulted in increased TSS numbers, sale of the lagoon will result in significant improvement to municipal wastewater treatment and a reduction in TSS and BOD discharges into the environment, an offset to the TSS increase. The mill remains in full compliance with its permits. Powell River continues to work on improving the performance of the wastewater treatment facility. adt – Air-dried tonnes of product n/d – Non-detectable (test result below two parts per quadrillion) 2378TCDD, 2378TCDF – Specific dioxin and furan congeners in waste water A complete glossary of terms and definitions is available at www.catalystpaper.com/products/glossary. SOLID WASTE TO LANDFILL (BY MILL) (cubic metres per air-dried tonne) 2013 2012 2011 2010 2009 Crofton Port Alberni Powell River 0.058 0.084 0.044 0.056 0.083 0.042 0.054 0.100 0.035 0.060 0.072 0.025 0.059 0.074 0.028 CATALYST PAPER 2013 SUSTAINABILITY REPORT WATER + ENERGY USE (BY MILL) 45 Crofton Water use m3/adt Fuel energy usage GJ Fuel energy intensity GJ/adt Electricity usage MWh Electricity intensity MWh/adt Total energy usage excluding self-generated electricity GJ Total energy intensity excluding self-generated electricity GJ/adt Port Alberni Water use m3/adt 1 Fuel energy usage GJ Fuel energy intensity GJ/adt Electricity usage MWh Electricity intensity MWh/adt Total energy usage excluding self-generated electricity GJ Total energy intensity excluding self-generated electricity GJ/adt Powell River Water use m3/adt Fuel energy usage GJ Fuel energy intensity GJ/adt 2 Electricity usage MWh Electricity intensity MWh/adt Total energy usage excluding self-generated electricity GJ Total energy intensity excluding self-generated electricity GJ/adt 1 2 2013 2012 2011 2010 2009 74 17,526,544 25.45 1,349,254 1.96 21,294,113 76 18,216,179 26.45 1,341,168 1.95 21,998,426 79 17,904,394 26.19 1,349,631 1.98 21,967,887 85 15,593,050 26.13 1,248,957 1.77 19,389,570 71 8,395,893 18.10 1,135,131 2.26 12,173,632 30.92 31.94 32.22 32.49 26.25 76 4,625,290 14.80 800,198 2.56 7,224,886 66 4,654,171 14.35 837,768 2.58 7,391,672 69 4,796,691 15.34 823,184 2.63 7,504,517 72 4,629,396 14.66 843,236 2.67 7,462,787 78 4,475,620 15.34 742,641 2.55 6,989,651 23.11 22.80 24.00 23.64 23.96 73 7,720,566 17.41 1,378,152 3.11 12,026,436 72 8,968,754 20.08 1,371,250 3.07 13,167,571 75 6,642,139 14.99 1,386,901 3.13 11,137,715 71 6,187,485 13.37 1,421,458 3.07 10,904,853 73 5,947,653 12.96 1,414,846 3.08 10,646,636 27.12 29.48 25.13 23.57 23.19 Water use increased in 2013 over 2012. This was attributable to continued high production in the CTMP plant at Port Alberni, which required increased use of cold water to control the temperature of effluent going to biological treatment. Powell River’s fuel energy intensity is substantially lower due to reduced natural gas firing in PB19 in 2013. adt – Air-dried tonnes of product GJ – Gigajoules MWh – Megawatt-hours Fuel energy measures include all purchased fuels and self-generated biomass (black liquor); electricity measures include all purchased and self-generated electricity. A complete glossary of terms and definitions is available at www.catalystpaper.com/products/glossary. CATALYST PAPER 2013 SUSTAINABILITY REPORT KEY MATERIALS + PRODUCTION MATERIALS SOURCED FROM WASTE (% 2013) 15 WOOD CHIPS AND PULPING LOGS HOG FUEL 26 59 46 OTHER MATERIALS 85% TOTAL SOURCED FROM WASTE Total excludes water consumption. TOTAL KEY MATERIALS USED AS TONNES (CORPORATE WIDE) 1 Water 2 Wood chips and pulping logs Hog fuel Precipitated Calcium Carbonate Clay Fossil fuels 3 Oxygen Sodium Hydroxide Sodium Chlorate Hydrogen Peroxide Sulphuric Acid Starch Sulphur Dioxide Silicate 1 2 3 2013 2012 2011 2010 2009 142,826,856 1,663,248 744,787 109,927 63,341 61,307 57,704 27,784 17,843 14,577 13,490 8,998 8,464 6,757 159,570,826 1,673,561 748,813 117,457 75,289 309,339 55,919 30,126 17,552 17,927 15,611 10,933 8,691 10,533 142,416,387 1,652,199 680,023 123,651 75,307 407,176 57,832 30,803 18,425 17,911 15,593 10,566 8,589 11,217 141,164,553 1,558,187 682,279 122,468 64,692 407,749 62,432 30,764 16,208 18,143 13,605 9,826 9,079 11,599 132,107,490 1,094,795 606,871 119,825 60,129 337,250 46,282 23,084 5,730 21,928 7,387 10,137 10,460 16,562 Includes Snowflake. Water use figures in this table include treated effluent, as well as discharges of cooling and storm water; consistent with standard industry practice, water use as shown in the key facts and figures (and as used to calculate water-use intensity) includes only treated effluent. Fossil fuels are also reported as gigajoules of heating value on page 38. A complete glossary of terms and definitions is available at www.catalystpaper.com/products/glossary. PRODUCTION (BY MILL) (tonnes of product) Crofton Elk Falls (closed operation) Paper Recycling (closed operation) Port Alberni Powell River Snowflake (closed September 30, 2012) 2013 2012 2011 2010 2009 688,774 – – 312,594 443,466 – 688,722 – – 324,231 446,732 220,118 681,910 – – 312,675 443,242 288,566 596,752 – 3,774 315,689 462,669 292,256 463,782 53,048 125,266 291,757 459,089 232,106 These figures quantify the operating-platform and production-level changes that impact environmental performance, particularly as measured in terms of absolute emissions. CATALYST PAPER 2013 SUSTAINABILITY REPORT REPORTED NPRI EMISSIONS (CORPORATE WIDE) 47 Not including speciated PAHs and Part 5 VOCs (tonnes) 2012 2011 2010 2009 2008 Carbon Monoxide Sulphur Dioxide Nitrogen Oxides Hydrochloric Acid* Volatile Organic Compounds (VOCs) – total Nitrate Ion Total Particulate Matter PM 10 Methanol* Phosphorus, Total PM 2.5 Manganese* Total Reduced Sulphur Ammonia Chlorine Dioxide Hydrogen Sulphide Zinc Phenol Acetaldehyde Sulphuric Acid* Carbonyl Sulphide 3,133 2,199 1,875 866 737 661 475 409 376 325 293 210 146 131 79 76 58 29 17 14 10 2,846 2,337 1,764 894 977 375 401 337 536 363 238 217 188 119 86 76 60 29 29 37 10 2,490 1,941 1,652 917 876 283 499 429 488 257 305 176 173 98 108 77 43 18 15 38 – 1,755 1,109 1,409 551 621 272 245 210 308 285 150 185 70 68 41 36 51 – – 34 – 2,924 4,242 2,399 841 1,273 201 801 666 729 449 471 383 202 261 115 74 56 – – 41 10 2,236 2,221 318 307 149 13 3,028 864 213 501 129 31 2,819 707 234 245 104 23 3,126 960 320 134 131 34 4,021 925 592 541 219 28 512 22 694 40 204 28 175 31 414 25 (kilograms) Lead* Arsenic Hexavalent Chromium Compounds Sum of PAHs (17) Cadmium Mercury* (grams) Hexachlorobenzene (HCB) Dioxins and Furans* * 2008 figures include full-year releases from Snowflake. Legislation in Canada requires facilities such as Catalyst’s to annually report releases of any of a large number of substances if they exceed defined thresholds, including releases to air, water and land, and volumes sent for disposal or recycling. Reported volumes are based on actual measurement or estimates arrived at using defensible methodologies. CATALYST PAPER 2013 SUSTAINABILITY REPORT This information is compiled by Environment Canada in the National Pollutant Release Inventory (NPRI) and is available via www.ec.gc.ca/inrp-npri and www.epa.gov/tri. The table above shows the combined total of all releases reported to the NPRI and Toxics Release Inventory (TRI) for all of Catalyst’s operations. Full-year releases from Snowflake are included for 2008 to 2011 only (see measures marked with an asterisk*). 2012 Snowflake TRI data is not available. Since releases are reported in the spring for the previous calendar year, 2013 data were not yet available when this report was prepared. Data are not included [ – ] in instances where reporting was not required by the regulator. Speciated PAHs, while reported individually to Environment Canada, are reflected in the table above as part of the “Sum of PAHs”. A complete glossary of terms and definitions is available at www.catalystpaper.com/ products/glossary. REGULATORY COMPLIANCE 48 A total of 28 events in the following three categories occurred at our operations in 2013: • Permit non-compliances – exceedances of specific limits or operating parameters defined in a regulatory permit • Reportable releases – accidental releases which are required to be reported to regulatory authorities due to the source or the nature of the material involved • Administrative errors – involving such matters as mechanical or procedural errors resulting in missed testing samples, but with which no known permit exceedance or release is associated 2013 EVENTS (28 TOTAL) All such instances are promptly reported to regulatory authorities, and the root causes are then analyzed in an effort to prevent recurrence. Using a methodology derived from our ISO environmental management systems, we have classified all such events in 2013 by significance1, based on the level of risk to humans and the environment, and the potential for legal sanctions. More details are provided on the facing page relating to all of the events in 2013. EVENTS BY IMPACTED ENVIRONMENT (corporate wide) 63 42 21 0 10 11 12 13 10 17 35 10 63 38 26 17 2 0 4 1 Air 13 Land 0 SIGNIFICANCE 1 IMPACTED ENVIRONMENT Water Air Land Low Medium High Permit Non-Compliance 10 4 6 0 4 6 0 Reportable Release 15 3 11 1 15 0 0 Administrative Error 3 3 0 0 3 0 0 1 EVENTS BY OPERATION 2 Crofton 2 09 Water 15 Elk Falls Port Alberni Powell River Snowflake Total 2013 12 0 6 10 n/a 28 2012 2011 2010 2009 19 28 21 8 11 2 3 2 1 0 3 4 26 12 5 12 8 13 39 0 46 40 29 24 Low significance: poses no threat to people or environment. Medium significance: poses some threat to people or environment. High significance: poses material threat to people or environment. Snowflake was closed in 2012 and Elk Falls was sold in 2013. CATALYST PAPER 2013 SUSTAINABILITY REPORT 2013 TOTAL MILL EVENTS 49 CROFTON (12 EVENTS) There were four compliance episodes where the mill failed to meet its bleach plant ClO2 concentration maximums of 10 ppm. A new process that combines odorous pulping gases and bleach plant emissions to eliminate both streams to be completed by Q2 2014 will correct this issue. Three of 10 fish died during LC20 leachate testing of the old closed landfill at Swallowfield. The site has been inactive for over two decades and no cause could be found. Compromised fish or a contaminated sample container is suspected as the cause. There were two events where non-ozone depleting refrigerant was released in small quantities just above the 10 kg report threshold. There was one event where ozone depleting refrigerant was released in a small quantity just above the 10 kg report threshold. There was one episode of elevated particulate from kiln stack. The cause of the problem was excessive buildup CROFTON CATALYST PAPER 2013 SUSTAINABILITY REPORT of solids on the inside of the lime kiln, which resulted in blow through of suspended particles. 220 litres of hydraulic fluid from a ruptured hose on a loader was released onto a deep chip pile. The contaminated chips were collected and subsequently reused as fuel in the power boiler. A small release of three kilograms of ground calcium carbonate was discharged through a storm drain into Stuart Channel during the transfer from rail to truck. Corrective actions have been taken to prevent spillage during trans-loading, and review of area storm water drains is underway. The mill’s third quarter miscellaneous TRS measured as total releases per tonne pulp was above the permit limit due to elevated releases from the A Brown Stock Wash vent due to a failed instrument. POWELL RIVER (10 EVENTS) There were three minor administrative errors related to missing samples over the year. There were two events where ozone depleting refrigerant was released in small quantities just above the 10 kg report threshold. There was a 400 m3 release of wastewater to Malaspina Strait following a brief power interruption. There was a 57 m3 release of wastewater to Malaspina Strait from manhole #3, combined with cooling water caused by a reset problem with the pump’s controls. There was an indeterminate discharge of elevated pH water caused by a level transmitter failure. There were two episodes where cooling water discharges were above the temperature limit, both of which lasted two minutes. PORT ALBERNI (6 EVENTS) There were six events where ozone depleting refrigerant was released in small quantities just above the 10 kg report threshold. PORT ALBERNI POWELL RIVER ADVANCING TRANSPARENCY + COMMUNICATING PROGRESS GLOBAL REPORTING INITIATIVE INDEX The Big Picture 2013 Highlights 2 2014 Goals 3 Message from the President 4-6 Sustainability Leadership 7-15 People 16-17 Stakeholder Engagement 18-19 Great Bear Rainforest 20-21 Workforce 22-25 Communities 26-27 Paper 28-32 Being Sage 30-31 Materiality 33 Mill Highlights 34 EVG+D 35 Responsible Operations 36-40 Environmental Data 41 Regulatory Compliance 48 Detailed GRI Index Online • • • • • • • • • • • • • • • • • SOCIAL • • • • A detailed index encompassing Catalyst’s full disclosure process and citing specific GRI indicators is available at: www.catalystpaper.com/ investors/sustainability-reports. We self declare our disclosure to be in accordance with GR4 Core guidelines. We welcome feedback on this report. Please email us at [email protected]. • • • • • • ENVIRONMENTAL • ECONOMIC • • • • • ETHICS + INTEGRITY G4-56 • • REPORT PROFILE G4-28 to G4033 • • STAKEHOLDER ENGAGEMENT G4-24 to G4-27 • • GOVERNANCE G4-34 Introductory Materials / Key Facts + Figures IDENTIFIED MATERIAL ASPECTS + BOUNDARIES G4-17 to G4-23 PAGES ORG PROFILE G4 – 3 to G4-16 REPORT SECTION STRATEGY + ANALYSIS G4-1 50 • • • • • • • • • • • • • • A full overview of our stakeholder landscape – including the groups to whom we believe this report to be of interest – is available in the GRI Index found on our website. CATALYST PAPER 2013 SUSTAINABILITY REPORT THE BIG PICTURE: PEOPLE PAPER PERFORMANCE WHAT IS THIS REPORT ABOUT? This report focuses on the wholly owned operations and worldwide sales of Catalyst Paper from January 1 to December 31, 2013. In this, our 11th sustainability report, we follow the Global Reporting Initiative’s (GRI) G4 guidelines and self declare in accordance with core disclosure. As in past years, the report covers those aspects of performance that are of most interest to our stakeholders. Our scope is largely unchanged from last year when our report earned the Chartered Professional Accountants award for corporate reporting. Our business circumstances in 2013 prevented us from contributing financially to the UN Global Compact and the Global Compact Canadian Network. Although we have withdrawn from the initiative, we remain committed to – and take guidance from – the principles of the UN Global Compact. We did not seek formal external assurance on the report, although we share the views of stakeholders on some of our key issues and initiatives. And we welcome reader feedback on this report, as well as ideas for future editions. Please share your thoughts with us by emailing [email protected] IMPACTS + BENEFITS ENVIRONMENT SOCIAL FINANCING LOW-IMPACT PRODUCTION PARTNERSHIPS + STAKEHOLDERS INVESTORS WATER QUALITY P37 GOVERNMENTS P19 CREDITORS CLIMATE CHANGE + GHGS P40 COMMUNITIES P26-27, 35-36 PERFORMANCE: PROGRESS ON 5 FRONTS NON-GOVERNMENTAL GROUPS P20-21 REGULATORY COMPLIANCE P48 1 RESOURCE USE MANUFACTURING PROCESS OUR PRODUCTS CORPORATE ATE E + DISTRIBUTION DISTR ON CUSTOMERS + COMPETITIVENESS P29-32, 36 ENERGY P38 MAGAZINES BOOKS DIRECTORIES WOOD FIBRE P37 CATALOGUES BROCHURES DIRECT MAIL RETAIL INSERTS NEWSLETTERS REPORTS, MANUALS, COMICS, GRAPHIC NOVELS EMPLOYEES + UNIONS P24 RENEWAL + RETENTION P22-24 SAFETY P25 EFFICIENCY P45 NEWSPAPERS POWELL RIVER PORT ALBERNI Produces paper for directories, catalogues, brochures, inserts, flyers and magazines such as Baron’s, Men’s Journal, In Touch, US Weekly and Rolling Stone TRANSPARENCY + DISCLOSURE P50 Produces paper for catalogues, magazines, newsletters, high volume magazines and books, including Fifty Shades of Grey, the fastest-selling paperback of all time NANAIMO FLYERS SURREY DISTRIBUTION CENTRE RICHMOND CROFTON Produces enough paper every year for 100 million phone books + 150 million daily newspapers including The Globe and Mail, The Wall Street Journal and The New York Times 2 3 5 4 INPUTS MANUFACTURING TRANSPORTATION PAPER LIFE CYCLE TRANSPARENCY 85% of our purchased raw inputs are waste products Yield focused – use less, waste less Multi-modal efficient logistics to reduce material miles and carbon emission from shipping finished product Partnerships to gain sustainability insight with organizations like World Wildlife Fund (WWF), GreenBlue, Greenpeace, Sierra Club BC, Forest Ethics and Corporate Knights Along the supply chain WATER P37 OTHER KEY MATERIALS P46 GENERAL MANAGERS + COMMUNITY LIAISON ENVIRONMENTAL LIAISON 2nd Floor, 3600 Lysander Lane Richmond, B.C. V7B 1C3 604-247-4400 CROFTON CROFTON Robert Belanger, General Manager P.O. Box 70 Crofton, B.C. V0R 1R0 250-246-6100 Brian Houle, Manager, Environment P.O. Box 70 Crofton, B.C. V0R 1R0 250-246-6236 PORT ALBERNI PORT ALBERNI BRIAN BAARDA Vice-President, Finance and Chief Financial Officer Fred Chinn, General Manager 4000 Stamp Avenue Port Alberni, B.C. V9Y 5J7 250-724-7525 Larry Cross, Manager, Environment 4000 Stamp Avenue Port Alberni, B.C. V9Y 5J7 250-724-7889 STEVE BONIFERRO Senior Vice-President, Human Resources POWELL RIVER POWELL RIVER Brian Johnston, General Manager 5775 Ash Avenue Powell River, B.C. V8A 4R3 604-483-3722 Sarah Barkowski, Manager, Environment 5775 Ash Avenue Powell River, B.C. V8A 4R3 604-483-2850 JOE NEMETH President and Chief Executive Officer FIRST NATIONS P19 SOLID WASTE P39 CATALYST PAPER CORPORATION Visit us online at www.catalystpaper.com ECONOMIC AIR QUALITY P39 CONTACTING CATALYST Certified chain of custody to Forest Stewardship Council (FSC) and Programme for the Endorsement of Forest Certification (PEFC) 90% renewable energy in our product manufacturing All of our fibre is from sustainably well-managed forests High-opacity paper offering bulk with less weight Paper with one of the lowest carbon footprints in North America High quality handling delivers orders on time, damage free GRAHAM KISSACK Sustainability Specialist On product labels highlighting pedigree and footprint LESS IS MORE Carbon, forest footprint, water disclosure as well as reporting to GreenBlue’s Environmental Paper Assessment Tool (EPAT) First environmental report published in 1993 www.catalystpaper.com/about/stance A five-point operating philosophy guides our efforts to continually meet the high expectations of our customers, investors, employees, communities and other stakeholders. 2013 READ MORE ONLINE Our annual financial report and sustainability summary foldout wrap for 2013 are available in the Investor Relations section of our website. This report contains forward-looking statements. Forward-looking statements are statements, other than statements of historical fact, that address or discuss activities, events or developments that Catalyst Paper expects or anticipates may occur in the future. These forward-looking statements can be identified by the use of words such as “anticipate”, “could”, “expect”, “seek”, “may”, “likely”, “intend”, “will”, “believe” and similar expressions or the negative thereof. These forward-looking statements reflect management’s current views and are based on certain assumptions and factors management believes are appropriate in the circumstances, including assumptions that there will be no material change to the regulatory environment in which the company operates, capital budgeted for certain goals will be available, and existing relationships with stakeholders will be maintained. Such forward-looking statements are subject to risks and uncertainties and no assurance can be given that any of the events anticipated by such statements will occur nor, if they do occur, what benefit Catalyst will derive from them. No forward-looking statement is a guarantee of future results. A number of factors could cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements, including technological and regulatory changes, cost constraints, Catalyst’s ability to successfully obtain operational and environmental performance improvements, and other factors beyond its control. Catalyst disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Designed and produced by smith + associates www.smithandassoc.com Please recycle Headquartered in Richmond, British Columbia (B.C.), Catalyst Paper employs 1,611 people and operates three mills and a distribution facility on Canada’s Pacific coast. Our combined annual production capacity of 1.5 million tonnes meets the needs of customers, including retailers, publishers, commercial printers, and manufacturers who use our pulp, in North America, Latin America, the Pacific Rim and Europe. Catalyst Paper Corporation 2nd Floor, 3600 Lysander Lane Richmond, B.C. V7B 1C3 604-247-4400 LIGHTER IS BETTER MESSAGE FROM THE PRESIDENT + CEO 04 PEOPLE 16 PAPER 28 PERFORMANCE 32 THE RESULTS: ENVIRONMENTAL DATA 41 REGULATORY COMPLIANCE 48 GRI INDEX 50 CATALYST PAPER 2013 SUSTAINABILITY REPORT www.catalystpaper.com We have earned a reputation for environmental stewardship based on our commitment to certified fibre sourcing, manufacturing efficiency, verified chain of custody and environmentally responsible paper operations. A public company, Catalyst’s shares trade on the Toronto Stock Exchange (TSX) under the symbol CYT. KEY FACTS AND FIGURES 01 PAPER FACTS inside pages of report (120.3 g) Production Notes INPUTS Raw Fibre (g) % certified sources 113 100 Filler (g) 45 Water (L) 9.1 Work (person secs) Energy (Cal) % renewable 1.3 664 91 EMISSIONS Greenhouse Gas (g) 11* Air Particulate (mg) 2.9 Effluent BOD (mg) 58 Solid Waste (cm3) 10 * Offset to zero The inside pages of this report are printed on Ascent Gloss Sage, Catalyst’s new coated three grade, produced at the Port Alberni mill. Ascent is our highest quality coated paper grade. Its brightness, superior opacity and excellent printability make it ideal for magazine, catalogue, high-end insert, commercial and direct mail print applications printed on heatset offset presses. Catalyst’s coated products are available under our Sage program, meaning they are certified (Programme for the Endorsement of Forest Certification) as containing 100% fibre from sustainably managed forests, that there were no net carbon emissions during their manufacture, and that detailed mill-level environmental performance data are available via GreenBlue’s Environmental Paper Assessment Tool (EPAT). We also contribute $1 for every tonne of Sage product sold to support our partner initiatives. The Paper Facts label identifies the inputs and emissions associated with this specific grade of paper calculated on a per-report basis. Catalyst customers can use the online Paper Calculator at http://catalystpaper.com/calculator to identify inputs and emissions associated with their own purchases and to compare them to typical North American paper products. This report was printed with inks that are formulated to contain plant-derived materials, and that comply with North American toxics-in-packaging legislation for heavy metal content. READ MORE ONLINE ABOUT OUR COMPANY catalystpaper.com/about/our-facilities Our manufacturing facilities have long histories and are economic drivers in the coastal communities where they are located.