Uncategorized Archives - Horizon Pulp & Paper Ltd.

Diversity & Inclusion are not buzzwords. They are the missing link to sustainability.

Nikhil Krishnan — Tue, 02 Aug 2022 06:42:53 +0000

In the 21st century, discussion surrounding diversity & inclusion (D&I) has become more prevalent in the world of business. Every year, studies and research only seem to strengthen the business case for diversity & inclusion. As per McKinsey & Company’s notable reports Diversity Matters (2015), Delivering through Diversity (2018) and Diversity Still Matters (2020), diversity & inclusion in a business organization leads to:-

– Well informed and comprehensive decision making

– Innovation through wide range of perspectives and ideas

– Higher employee motivation and organizational commitment

– Attraction of top talent (Note: Gen Z expects good D&I performance from companies)

– Stronger global brand image

– Stronger financial performance

Despite an overwhelmingly strong business case for diversity & inclusion, it may still be misunderstood as merely ‘a moral option’ for businesses. Some companies could even consider having to choose between focusing on diversity & inclusion and ESG initiatives, another important factor expected in modern business.

It does not have to be this way.

Diversity & inclusion is a company’s competitive advantage, especially in a globalized economy.

Customers are increasingly diverse with different social/ethnic backgrounds and needs. Having a homogenous organizational group leads to limited perspective, inclusion and decision making. This may not adequately serve all customers.

When a company embraces diversity & inclusion as a competitive advantage, it becomes easy to implement and essential in serving customer needs. Diversity & inclusion has become just as important as fulfilling ESG/sustainability initiatives. Just as ESG initiatives contribute towards stronger financial performance and well-being of all stakeholders, so does diversity & inclusion.

Moreover, one does not have to be chosen over the other.

In fact, Diversity & inclusion is the missing link to a business’s sustainability and ESG goals.

How is diversity & inclusion linked to sustainability and ESG performance?

Like customers, other stakeholders are also just as diverse in the modern world. In order to serve diverse communities, we must embrace diverse voices of the communities and in our own organization. Diversity & inclusion impacts each of the ESG components as follows:

1. E (Environmental):

– Better understanding of both global and regional scopes of environmental problems. Thus, organizations can devise strategies for different environmental problems in both regional and global contexts.

– Effective, inclusive communication on environmental issues both internally and externally.

– Bolder innovation in solving environmental problems through diverse ideas and perspectives.

– Prevention of environmental discrimination and ensuring the benefits of environmental impact is equally experienced by all people in a community.

2. S (Social):-

– Helps ensure equality and safety in the workplace. – This in turn improves employees’ work performance and commitment to company’s sustainability initiatives.

– Encourages ethical sourcing with positive social impact.

– Helps reach a wider community and eliminates any possible discrimination in social initiatives.

3. G (Governance):-

– Inclusive decision making from management board wherein interests of all stakeholders such as employees, Environment, customers and community are taken in consideration.

– Instillation of transparency and trust in the organization. Diverse stakeholders will trust that their concerns will be heard and acted upon while leadership takes accountability.

One step further: Diversity, Equity and Inclusion (DEI)

‘Equity’ in Diversity, Equity and Inclusion (DEI) is the final component that ensures proper inclusion of diversity takes place in an organization. It ensures justice, equality, fairness and proper governance in an organization. Thus, it complements the ‘Governance’ component of ESG system.

Combining DEI and ESG initiatives in harmony ensures far-reaching positive impact of an organization’s sustainability initiatives.

Creating possibilities, for Generations

Horizon consists of 350 employees from over 15 nationalities. Some of the nationalities include Italian, Estonian, Singaporean, Indian, Ukrainian, Finnish, Russian and Armenian. We believe that a diverse team is one of the reasons for our success in serving our local community and our customers in 74 countries worldwide.

Together with our parent group Tolaram, we believe in creating possibilities for generations through sustainable development.

Sustainable development was defined by the UN in 1987: “Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

It is essential for us to listen to diverse voices to create possibilities for both current and future generations.

References:

Hunt, V., Layton, D., & Prince, S. (2015). Diversity Matters. McKinsey & Company. https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/~/media/2497d4ae4b534ee89d929cc6e3aea485.ashx

Hunt, V., Yee, L., Prince, S., & Dixon-Fyle, S. (2018). Delivering growth through diversity in the workplace. McKinsey & Company. https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/delivering-through-diversity

Dolan, K., Hunt, V., Prince, S., & Sancier-Sultan, S. (2020). Diversity still matters. https://static1.squarespace.com/static/561d0274e4b0601b7c814ca9/t/5ede28f14191b966b7436ae0/1591617786565/Diversity-still-matters-McKinsey+2020_06.pdf

United Nations. “Our Common Future.” 1987.

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Can global supply chains continue to thrive?

Nikhil Krishnan — Tue, 19 Jul 2022 11:54:06 +0000

In 1980, Nobel Laureate and economist Milton Friedman championed global free markets as fostering “productive efficiency, harmony and peace among the peoples of the world” [1]. He made this statement while explaining how people and organizations from multiple countries cooperate in manufacturing of a pencil.

Since then, the world has come a long way having accelerated towards a globalized economy. The modern world is unimaginable without global supply chains which are present in nearly 80% of world trade. [2] Horizon is also a part of the global packaging supply chain, exporting its sack kraft paper products to valued partners in over 70 countries worldwide.

However currently, global supply chains are increasingly being disrupted due to various factors such as COVID-19 pandemic and international conflicts. Amongst these factors, climate change is perhaps the most critical as it is a long-term problem. We are already witnessing high inflation rates and shortage of essential supplies in many parts of the world as a result.

As the world inches closer to a climate catastrophe, disruptions in global supply chains are intensifying as follows:

– Extreme weather conditions lead to decrease in supplies. Italy, Spain and Portugal are experiencing extreme droughts this summer which have dried up the region’s important rivers of Po and Tagus. There is thus a water shortage and reduced supply of important produce such as olives, tomatoes and oranges.

– Extreme weather conditions drive increase in electricity and transportation costs. Hence, prices of goods would increase. There is a global rise in inflation. Eurozone, the US and UK among other regions are seeing record high levels of inflation rates.

– Changing climate cycles are already disrupting transportation services in the form of cancellations, delays and even service closures. Rising sea levels will pose problems for infrastructure in sea, rail and highway transportation.

– Extreme temperatures leads to harsher working conditions which would in turn disrupt workforce productivity in supply chain. This would lead to migration of workers from areas with extreme temperatures and thus a shortage of workers in such areas.

While reverting to a localized supply chain could seem like a solution to these problems, it is not entirely feasible today. Moreover, climate change is a global problem. No region on Earth is unsusceptible from its adverse effects. Therefore, the problem of climate change must be mitigated on a global scale.

In fact, global supply chains can help mitigate climate change risks and reduce disruptions if managed collaboratively and strategically. [3] This would help global supply chains to continue thriving.

Global supply chain networks have the following unique advantages:

– Ability to foster innovation:-

When global partners are cooperating as part of a supply chain, they have the ability to share knowledge and best practices. [4] They can benefit from this knowledge in improving processes and technologies, thus steering innovation. Global partners also have necessary contacts across the world which could aid another member in the supply chain in case of any disruption or urgent need.

– Ability to create a wide reaching ripple effect:-

Due to firms being closely connected with each other, industry trends or a fundamental requirement of one firm can ‘ripple’ across the entire supply chain globally.

Working strategically with these advantages, global supply chains can mitigate climate change risks as follows:-

– Global partnerships towards clean energy & energy efficiency:

Achieving a clean energy transition is key in reducing emissions, a major factor contributing towards climate change.

Companies can closely work together with financial institutions and government stakeholders to incentivize, promote and standardize use of clean energy sources internationally. Use of clean energy sources such as renewable energy reduces emissions, energy dependency and increases energy efficiency. This helps in mitigating climate change risks.

Multinational technology manufacturers are already innovating towards making technologies energy efficient. When businesses use such technologies, it in turn helps their products and services become energy efficient. Moreover, energy efficiency drives down costs. Thus, the entire supply chain across the world can strive for energy efficiency.

– Adoption of circular economy principles worldwide:

Supply chain partners’ ability to cause a ripple effect can drive implementation of circular economy principles throughout the global supply chain. Hence, a supply chain is converted into a green supply chain.

In sack kraft paper and packaging industry for example, it has now become the minimum requirement in most parts of the world that the product is recyclable or reusable. Moreover, companies creating products that allow for circular economy to thrive in a global value chain are often considered reliable international partners.

Horizon’s products are well known for their sustainable properties and contribute towards circular economy in packaging value chain in over 70 countries. For this reason, it is considered a reliable international partner for sack kraft paper products.

Through innovation and shared knowledge of global partners, companies can implement circular economy principles at all stages: product design, sourcing, manufacturing process and during/post-product use.

Circular economy helps supply chains achieve higher energy & material efficiency with reduced cost and waste while ensuring quality.

In order to achieve above objectives in all parts of the world, global partnerships are needed in ensuring coherent international compliance standards.

The most important thing in these trying times for global supply chains is working together towards a shared goal: mitigating climate change risks to carry out worldwide operations with minimal disruptions. Global supply chains could have what it takes to do so.

References:

[1] Milton Friedman – I, Pencil. (2012). Free to Choose Network. https://www.youtube.com/watch?v=67tHtpac5ws

[2] Müller, G. (2022, June). Working together on global supply chains can help prevent climate disaster. Industrial Analytics Platform. https://iap.unido.org/articles/working-together-global-supply-chains-can-help-prevent-climate-disaster

[3] Müller, G. (2022, June). Working together on global supply chains can help prevent climate disaster. Industrial Analytics Platform. https://iap.unido.org/articles/working-together-global-supply-chains-can-help-prevent-climate-disaster

[4] Müller, G. (2022, June). Working together on global supply chains can help prevent climate disaster. Industrial Analytics Platform. https://iap.unido.org/articles/working-together-global-supply-chains-can-help-prevent-climate-disaster

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Earth Day: How can businesses invest in the planet?

Nikhil Krishnan — Fri, 08 Jul 2022 12:00:15 +0000

Today is Earth Day and this year’s theme is ‘invest in our planet’.

On this day, it is impossible to ignore the latest review on climate change issued by IPCC – the UN’s Intergovernmental Panel on Climate Change which consists of world’s leading climate scientists.

Essentially, it is a final warning that it is now or never if the world wants to prevent a climate catastrophe.

The review describes Earth’s dire situation [i]:

– The previous decade was the world’s warmest decade ever with highest greenhouse gas (GHG) emissions in human history.

– No inhabited region in the world can avoid climate change.

– Millions of people are already experiencing food and water shortages due to droughts, floods and other extreme weather conditions.

– Temperatures could rise to more than 3 degree Celsius if no urgent action is taken, making damage irreversible.[ii]

– Climate change will put everything at stake, making the Earth uninhabitable.

However, all hope is not lost. The review also recognizes the “increasing evidence of climate action”.[iii] The rate of growth in GHG emissions has decreased as a result and all sectors now have options “to at least halve emissions by 2030”.[iv]

If people, governments, and businesses act now and invest in the planet, the climate catastrophe can be prevented with limiting of global warming to 1.5 degree Celsius. Businesses, in particular, can play a vital role in significantly reducing emissions and leading a green energy transition.

But why should businesses invest in our planet?

There are several reasons:

– Climate change leads to scarcity of resources resulting in adverse impact on the economy, business operations and supply chains.

– Climate change leads to frequent energy price shocks.

– Business risks related to failure in compliance with government regulations that are established to tackle climate change.

– More consumers each year choose to do business with environmentally and socially responsible companies. Nearly half of Gen Z has stopped purchasing from companies due to sustainability and ethical concerns.[v]

– Good business sustainability performance has a positive correlation with improved financial profitability and happier employees.[vi]

When businesses invest in the planet, they invest in themselves and their future.

How can businesses reduce their environmental impact?

Businesses of all sizes can invest in reducing environmental impact.

Let us start with industrial businesses, which account for a quarter of global emissions. These businesses can reduce emissions by:

– Reducing use of fossil fuels:

The IPCC report clearly indicates that use of fossil fuels must be substantially reduced to halve emissions by 2030. Fossil fuel can be replaced with renewables. The cost of renewable energy such as solar and wind has decreased by up to 85% since 2010, making renewable energy cheaper than fossil fuels.[vii] Renewable energy is now a financially feasible option.

– Lowering energy consumption:

Industries can invest in more energy efficient technologies and make their processes more efficient to lower energy consumption.

– Investing in emission capture & storage technologies

Other businesses can also create a map of their carbon footprint and analyze how they can reduce their footprint. In addition to the above ways of reducing environmental impact, businesses can also:

– Drive product & process innovation:

Businesses can use reusable and recyclable materials or make their process more efficient to generate minimum waste.

– Ensure a sustainable supply chain:

Businesses can demand that their suppliers are compliant with sustainability requirements. This shall lower the overall carbon footprint of the business’s product/service. This would also cause a ripple effect causing the suppliers to ensure that they in turn have a sustainable supply chain as well.

Investing in the planet can enhance public health & well-being, employment and business opportunities.

Horizon has made investments in the planet which has resulted in increased efficiency, responsibly produced quality products and a happy workforce.

Horizon had outperformed the EU 2020 Climate & Energy targets in 2020. It has already met most of the EU 2030 Climate & Energy targets and is on track to meet remaining targets before 2030.

Our paper and paper bag products are produced with raw material wood sourced from responsible managed forest only. Responsible management of forestry ensures preservation of forest, an important carbon sink.

We hope that your business invests in itself by investing in the planet.

References:

[i] Harvey, F. (2022, February 28). IPCC issues “bleakest warning yet” on impacts of climate breakdown. The Guardian. https://www.theguardian.com/environment/2022/feb/28/ipcc-issues-bleakest-warning-yet-impacts-climate-breakdown

[ii] Harvey, F. (2022, April 4). IPCC report: “now or never” if world is to stave off climate disaster. The Guardian. https://www.theguardian.com/environment/2022/apr/04/ipcc-report-now-or-never-if-world-stave-off-climate-disaster

[iii] IPCC. (2022, April 4). The evidence is clear: the time for action is now. We can halve emissions by 2030. IPCC. https://www.ipcc.ch/2022/04/04/ipcc-ar6-wgiii-pressrelease/

[iv] IPCC. (2022, April 4). The evidence is clear: the time for action is now. We can halve emissions by 2030. IPCC. https://www.ipcc.ch/2022/04/04/ipcc-ar6-wgiii-pressrelease/

[v] Deloitte. (2021). Shifting sands: Are Consumers Still Embracing sustainability? Deloitte. https://www2.deloitte.com/uk/en/pages/consumer-business/articles/sustainable-consumer.html

[vi] Whelan, T., & Fink, C. (2016, October 21). The Comprehensive Business Case for Sustainability. Harvard Business Review. https://hbr.org/2016/10/the-comprehensive-business-case-for-sustainability

[vii] IPCC. (2022, April 4). The evidence is clear: the time for action is now. We can halve emissions by 2030. IPCC. https://www.ipcc.ch/2022/04/04/ipcc-ar6-wgiii-pressrelease/

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Estonia brings more to the world besides Digital Innovation

Nikhil Krishnan — Fri, 08 Jul 2022 11:00:23 +0000

This week, we celebrate the 104th anniversary of the Republic of Estonia.

While Estonia is a small country with a population of about 1.3 million, it is a country with big innovative ideas. It has already made a name for itself as the world’s first digital society and as the silicon valley of Europe. Notable international media such as BBC[1], Forbes[2] and Deutsche Welle[3] have recognized Estonia’s innovative digital infrastructure, nurturing entrepreneurial ecosystem and e-residency program which invite and empower entrepreneurs from all over the world. Moreover, the World Economic Forum has dubbed Estonia the most entrepreneurial country in the world.[4]

While Estonia is a unicorn factory which has created the most startup unicorns per capita in the world, cutting-edge tech startups are not the only offering of Estonia’s dynamic entrepreneurial landscape. Like the Estonian people who are progressive yet maintain close ties with tradition and nature, the entrepreneurial landscape in Estonia is rather a blend of progressive tech companies and traditional industries innovating in natural and organic products. In this article, we explore both sides of Estonia’s modern entrepreneurial mix which contribute towards international business:-

Estonia’s digital enterprise: Tech companies bringing Estonia’s digital innovation to the world.
Estonia’s ecological enterprise: Traditional industries bringing Estonia’s ecological innovation to the world.

Estonia's Digital Enterprise: Bringing digital innovation to the world

Estonia embraced a digitally connected world well before other countries. Estonia was:

– One of the first countries to declare access to the internet a basic human right in 2001.[5]
– The first country to implement an internet voting system in 2005.[6]
– The first country in the world to use blockchain technology for data security in 2012.[7]
– The first country to establish e-residency program in 2014 open to all world citizens. [8]

The digitally connected society of Estonia has served as the ideal environment for tech companies to carry out digital innovations. Some internationally known unicorn stories of Estonia include: Pipedrive – innovative CRM software used around the world [9], Bolt – digitally enabled mobility services in over 45 countries [10], Wise – innovation in Fintech sector by making international money transfers cheaper and simpler [11].

Additionally, Estonia has brought digital innovation to other sectors such as cyber security, digital logistics, e-commerce and IT R&D. The picture on the right is of self driving delivery robots in Estonia.

Estonia's Ecological Enterprise: Bringing ecological innovation to the world

In parallel to a digitally enabled life, Estonians value nature. The country’s rich traditional culture promotes healthy organic life and Environmental sustainability.

Half of Estonia is covered with forests. Much of these forests are responsibly managed. The country’s responsibly managed forestry has inspired traditional Estonian companies to build a thriving organic food industry and one of Europe’s large bioeconomies.[12]

Traditional industries are not ancient industries. They are innovative industries which combine ecological and organic wisdom with modern scientific approach to create the value of healthy, natural life.

An example of organic product found in Estonian forests is Chaga. Chaga is a mushroom which has been used as a traditional medicine to cure various illnesses since the 16th century.[13] Chaga based elixirs, tea and smoothies can boost the body’s immune system and serve as organic superfoods.

Estonian company Chaga Health develops its products in cooperation with R&D partners and innovation laboratories in Estonia, Germany and Belgium.[14] Chaga Health elixirs are exported to Europe, Asia, Australia and North America.

The Bioeconomy of Estonia is linked to 30% of Estonia’s economic output and relies on traditional industries related to forestry such as agriculture and manufacturing of wood based products.[15] Preservation of forests and environment through circular economy initiatives plays a key role in Estonia’s bioeconomy, especially when climate change increasingly becomes a challenge.

Horizon Pulp & Paper Ltd. is an example of traditional industry contributing to Estonia’s bioeconomy and environmental sustainability. Horizon manufactures 100% virgin sack kraft paper and paper bags with raw material from responsibly managed forests. It has innovated in developing specialty paper products to serve specific end use functions. Some examples are Horizon RustArrest® specialty paper which acts as a corrosion inhibitor for automotive and electronics packaging; and Horizon MoistResist® paper bags which offer high strength in wet conditions for packaging of agricultural produce. Horizon exports its paper products to over 70 countries worldwide. The products are fully recyclable, renewable, reusable and biodegradable – they come from nature and go back to nature.

Horizon has invested in renewable energy production as an alternative to fossil fuels. As a result, Horizon’s renewable energy share of the total energy consumed for paper manufacturing is over 80% – far ahead of the EU 2030 target of 32%.

Other notable bioeconomy industries in Estonia include Graanul Invest Group, AS Estonian Cell, UPM and Stora Enso Eesti AS

Estonia leads the world in innovation

With the combined strength of digital and ecological expertise, Estonia leads in business innovation internationally. It is a well-suited place for starting a new business venture.

Reference List:

[1] Galloway, L. (2019, July 1). Five countries on the frontline of tech. BBC. https://www.bbc.com/travel/article/20190630-five-countries-on-the-frontline-of-tech?ocid=ww.social.link.twitter

[2] Stone, M. (2016, June 14). The Tiny European Country That Became A Global Leader In Digital Government. Forbes. https://www.forbes.com/sites/delltechnologies/2016/06/14/the-tiny-european-country-that-became-a-global-leader-in-digital-government/#b1c59fae13a8

[3] Bathke, B. (2017, December 29). Digital residency pays off big for Estonia. https://www.dw.com/en/digital-residency-pays-off-big-for-estonia/a-41969304

[4] Europe’s Hidden Entrepreneurs Entrepreneurial: Employee Activity and Competitiveness in Europe. World Economic Forum. 2016. https://www3.weforum.org/docs/WEF_Entrepreneurship_in_Europe.pdf

[5] Shore, P. by L. A. with M., Shore, produced by M., & Slaney, R. Internet access is now a basic human right: part 2 – Chips with Everything tech podcast. The Guardian. 2016. https://www.theguardian.com/technology/audio/2016/aug/04/internet-access-human-right-2-tech-podcast

[6] Enter E-Estonia. E-Estonia. 2021. https://e-estonia.com/wp-content/uploads/e-estonia-200121-eng.pdf

[7] Enter E-Estonia. E-Estonia. 2021. https://e-estonia.com/wp-content/uploads/e-estonia-200121-eng.pdf

[8] Enter E-Estonia. E-Estonia. 2021. https://e-estonia.com/wp-content/uploads/e-estonia-200121-eng.pdf

[9] About us. Pipedrive. Retrieved February 17, 2022, from https://www.pipedrive.com/about

[10] About us. Bolt. Retrieved February 17, 2022, from https://careers.bolt.eu/about-bolt

[11] The Story of Wise. (2016). Wise. https://wise.com/gb/about/our-story

[12] Bioeconomy / Timber. Invest in Estonia. Retrieved February 17, 2022, https://investinestonia.com/business-opportunities/bioeconomy/

[13] Chaga mushroom – the king of medicinal mushrooms. (2020, March 14). Chaga Health. https://chagahealth.eu/en/chaga-ehk-must-passik-meditsiiniseente-kuningas/

[14] Tradition & science. Chaga Health. Retrieved from https://chagahealth.eu/en/tradition-and-science/

[15] Bioeconomy / Timber. Invest in Estonia. Retrieved February 17, 2022, https://investinestonia.com/business-opportunities/bioeconomy/

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EU is deep in energy crisis. Is there a way out?

Nikhil Krishnan — Fri, 08 Jul 2022 10:14:32 +0000

Europe in particular is experiencing a difficult situation in the current global energy crisis.

EU has seen an unprecedented rise in energy prices with benchmark European natural gas prices sharply climbing by nearly 400% in 2021. [i] As of January 2022, energy costs in EU are 54% higher than 2020 levels. [ii] This winter, households and businesses in EU are struggling to cope with high energy prices to keep premises warm and run day-to-day operations.

What led to this steep rise in energy prices?

During the initial months of the COVID-19 Pandemic in 2020, demand for energy drastically reduced as many economies and businesses closed temporarily. Oil & gas and other fossil fuel industries reacted to decreased energy demand by curtailing production.

As the world learned to live with COVID, the global economy rebounded unexpectedly in the first half of 2021 which led to an increase in demand for energy. The fossil fuel industry had not experienced such an increase in market demand and had low reserves.

While there was substantial ramp up in production, demand-supply gap continues to be there. The sudden surge in energy demand led to a globally disrupted supply chain and shortage of energy. As a result of energy shortage, energy prices have increased globally.

Why has EU in particular suffered during this crisis?

To answer this question, it is important to understand the unique circumstance the Eurozone has found itself in when the global crisis began.

China was the first to experience the energy crisis in 2021. China has traditionally relied on coal mines for its energy production and consumption. As global demand for Chinese goods increased due to global economy rebound, the country’s energy supply could not meet its own unexpected energy demand. To mitigate this energy shortage, China decided to shift towards importing liquefied natural gas (LNG). EU has been increasingly dependent on LNG for its energy needs having increased its LNG imports by 165% in 2019 as compared to 2015 levels.[iii] The rise in LNG demand from China was not expected by world gas traders. Much of the LNG which is usually supplied to Europe was now being supplied to China and other Asian regions instead. EU’s demand for pipeline based natural gas increased drastically as a result. Natural gas suppliers however could not meet EU’s newly increased gas demand at a short notice due to low reserves and planned maintenance in the oil & gas industry which was previously postponed because of the COVID-19 pandemic.[iv]

Fossil-fuel based energy sources account for nearly 70% of EU’s energy consumption mix despite the region’s ambitious green transition plan to phase out non-renewable energy production in favour of renewable energy. [v] As EU phased out and divested from its own fossil fuel and nuclear energy production facilities in the past decade, it has been slow in increasing its renewable energy share. Thus, it finds itself still heavily dependent on importing fossil fuel energy sources such as oil & gas from the global energy market. The EU also experienced an unusual problem of milder wind speeds in 2021 which led to decreased electricity generation from windmills in the region. In a combination of global circumstances and unusual incidents, the dynamics of global energy market changed and EU failed to secure energy.

As a short term goal to mitigate this crisis, the EU is considering to restart its closed coal and nuclear plants. However, doing so will have a further detrimental effect on climate change and progress made thus far to reduce GHG emissions.

The crisis reveals two key underlying issues:

1. The world is still heavily dependent on fossil fuel energy and EU is no exception. EU in particular is dependent on the global fossil fuel supply chain.

2. Climate change remains an unavoidable threat and lingers at the core of this crisis. Further usage of non-renewable resources for energy production will cause setbacks in Europe’s (and the World’s) ambitions of becoming carbon neutral.

If only Europe had a higher renewable energy share, the region may not have faced such a difficult situation. The region would not have had to depend on the global energy supply chain and face a setback in its climate change goals.

What should the EU do to avoid another energy crisis in the future?

Renewable energy is key to EU’s energy independence and climate change goals. While the EU has been a global leader in formulating ambitious decarbonization plans, decarbonization efforts have proved to be too slow. Elisabetta Cornago, research fellow in EU Energy and Climate Policy at the Centre for European Reform in Brussels, states that “in the long term, decarbonizaing the energy sector is the best strategy for Europe to durably reduce its energy prices and improve its energy security” [vi]

Renewable energy will not only make the EU more energy independent, but also drastically reduce energy prices due to its cost effectiveness. Renewables have a significantly lower cost than fossil fuel energy sources.[vii] Building and operating renewable energy plants cost less than running gas or coal plants.[viii]

There are several options available for generating renewable energy such as hydropower, solar, biomass and wind.

To avoid another energy crisis, the EU should work towards increasing its renewable energy share. It should do so aggressively with a sense of urgency, resetting its renewable energy targets.

EU’s renewable energy share is at only 22.1%.[ix] Horizon Pulp & Paper has a renewable energy share of 80%.

Renewable share is key to Europe’s immediate future. Let us get there together as soon as possible.

References:

[i] Energy crisis: Will a green transition throw the global economy into recession? | Business Beyond. 2021. DW News. https://www.youtube.com/watch?v=n0GT-oZD8nc

[ii] Morison, R., & Gillepsie, T. (2022, January 5). European Energy Bills to Rise 54% from 2020 Level, BofA says. Bloomberg. https://www.bloomberg.com/news/articles/2022-01-05/european-energy-bills-to-rise-54-from-2020-level-bofa-says

[iii] European Commission, Directorate-General for Energy, EU energy in figures : statistical pocketbook 2021, Publications Office, 2021, https://data.europa.eu/doi/10.2833/975418

[iv] Energy crisis: Will a green transition throw the global economy into recession? | Business Beyond. 2021. DW News. https://www.youtube.com/watch?v=n0GT-oZD8nc

[v] European Commission, Directorate-General for Energy, EU energy in figures : statistical pocketbook 2021, Publications Office, 2021, https://data.europa.eu/doi/10.2833/975418

[vi] Dempsey, J. (2021, October 28). Judy Asks: Is Europe’s Energy Crisis Self-Inflicted? Carnegie Europe; Carnegie Europe. https://carnegieeurope.eu/strategiceurope/85668

[vii] Masterson, V. (2021, July 5). “Renewables” power ahead to become the world’s cheapest source of energy in 2020. World Economic Forum. https://www.weforum.org/agenda/2021/07/renewables-cheapest-energy-source/

[viii] Mathis, W. (2021, June 23). Building New Renewables Is Cheaper Than Burning Fossil Fuel. Bloomberg Green; Bloomberg. https://www.bloomberg.com/news/articles/2021-06-23/building-new-renewables-cheaper-than-running-fossil-fuel-plants

[ix] (2022, January). Renewable energy statistics. Eurostat; European Commission. https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Renewable_energy_statistics

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Horizon awarded Contributor of the Year Award

Nikhil Krishnan — Thu, 07 Jul 2022 13:13:15 +0000

Horizon has been awarded Contributor of the Year 2021 by Harju County Entrepreneurship and Development Center. Harjumaa Government Associations are the co-organizers of the award. The award is given to an organization that contributes to economic development and local community of Harjumaa through its inspiring activities.

Horizon has been committed to improving the Environmental, Economic and Social well-being of the Harju community. We believe businesses should be inclusive towards serving all stakeholders.

Reversing climate change

As a responsible business dedicated to reversing climate change, Horizon has implemented various initiatives to reduce greenhouse gas (GHG) emissions. We have achieved a reduction of 82% which is much ahead of the 2030 EU Climate and Energy package target of 40% reduction in GHG emissions. Horizon has invested in renewable energy production as an alternative to fossil fuels. As a result, our renewable energy share of the total energy consumed for paper manufacturing is 80% – far ahead of the EU 2030 target of 32%.

Sustainability is our core business value which we practice in our entire value chain from sourcing of raw materials to manufacturing paper products. Sustainability is not just about the environment but also about bringing positive social change.

Social uplifting

COVID has been stressful for all of us. It has especially affected many vulnerable groups such as children with special needs. During the COVID lockdown period, the children were confined to their homes with their families. Long periods of isolated confinement within their homes led to emotional turmoil and depression for the elders. We collaborated with a nonprofit organization and arranged counselling sessions for the elders to help them overcome depression and return to normal life.

Another vulnerable group significantly affected by the COVID lockdown were homeless people. During these difficult times, they could hardly find a decent meal. We collaborated with Estonian Food Bank (Eesti Toidupank) and the Mother Teresa Missionary assisting with food and other essentials for homeless people.

Education is key for positive social change. We have initiated study modules in Kehra School for final year students, introducing them to natural science topics such as environment protection, sustainability and technology. Experienced Horizon personnel have conducted lectures on these topics at the school.

In August 2020, we built a paper room in Anija Manor in close cooperation with the Anija municipality. The room explains Sustainability as a concept to visitors and showcases the evolution of our mill.

We are thankful to everyone for recognizing and supporting our efforts in contributing towards climate change reversal and social uplifting.

We shall continue to serve our community and society.

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Circular Economy in Construction Industry

Nikhil Krishnan — Thu, 07 Jul 2022 10:51:33 +0000

In a previous blog article we discussed the importance of circular economy principles in manufacturing industries such as packaging. In this article, we would like to explore the importance of circular economy in the construction and building industry.

Why is implementation of circular economy model in the construction industry important?

Construction and buildings have a significant impact on global economy and quality of life. To carry out its activities, the construction industry requires a vast amount of resources and materials. Due to inefficient use of resources, the industry’s practices have had a significant impact on our environment.

The global construction industry consumes up to 40% of all raw materials extracted from the lithosphere.[1] It is responsible for nearly 50% of global greenhouse gas (GHG) emissions.[2]

In the European Union, the construction sector consumes nearly 40% of the region’s total energy.[3] It is responsible for over 35% of the total waste generation in the EU.[4] Large quantities of the waste generated cannot be reused or recovered, eventually ending up in landfills. The industry accounts for 36% of GHG emissions in the EU.[5]

Despite construction industry’s current environmental impact, it has the potential to prevent further impact through adoption of circular economy principles. According to European Commission’s Circular Economy Action Plan (CEAP), emissions could be reduced by 80% if materials were more efficiently used.[6]

The European Green Deal recognizes construction as a key sector which can contribute towards Europe’s goal of achieving carbon neutrality by 2050. The Circular Economy Action Plan (CEAP) has identified the potential to increase material efficiency and reduce emissions in the construction industry which can significantly reduce current environmental impact. The CEAP further states this can be carried out through the Strategy for a Sustainable Built Environment.

This strategy aims to promote circular economy principles in construction industry and ensure integration between policy areas such as energy and resource efficiency, construction & demolition waste (CDW) management and climate change.

As part of this strategy, the EU aims to:

1. Revise the Construction Product Regulation for creation of sustainably designed products with low carbon footprint. A recycled content requirement could be introduced, encouraging use of more recycled materials in the product while ensuring the same quality, performance and safety conditions.

2. Use the “Reduce, Reuse and Recycle” approach for product design and waste management. Construction Demolition and Waste shall be managed more efficiently with new recovery targets.

3. Implement Life Cycle Assessment in public procurement

4. Increase energy efficiency through optimized lifecycle performance and increased durability and lifetime of buildings

Material choice can facilitate improvements in material efficiency and reductions in GHG emissions. Construction materials that are designed to be produced in an energy efficient manner, to last long and to be reused can make a difference.

Some examples of such construction materials that are increasingly being used today are:

1. Clay Plasters

Clay and clay plaster are some of the oldest building materials in the world. In ancient times, many cultures around the world used colored clay plaster in interiors of stone buildings and caves. Clay plasters have received a renewed interest in recent years for its Earthly qualities and low environmental footprint. Clay is a naturally abundant material and clay plasters require comparatively low energy to manufacture as they do not require processing, only blending.[8]

Clay plasters are also a preferred surface finish material for walls and ceilings due to its non-toxic properties. The clay minerals in the plaster are able to absorb odors and pollutants, keeping the air clean.[9]

Moreover, they have excellent moisture-handling properties which help regulate humidity inside homes and keep stable room temperature. Due to non-toxic and good moisture-handling properties, they provide breathability to the finish.[10]

Clay plasters do not set chemically unlike other plasters, they dry easily when applied.[11] They are flexible, require minimal maintenance and last long with an expected life span of 60 years.[12] At the end of its life cycle, clay plasters are still recyclable, reusable and biodegradable. This makes clay plasters a good example of building materials with circular design. Combined with beautiful and aesthetic textures, these factors allow clay plasters to improve quality of living inside homes.

2. Green Concrete

Green concrete is concrete that replaces a portion of cement with alternative materials.

Cement is a key component used in manufacturing of concrete. Every year, over 4 billion tonnes of cement is produced and accounts for 8 per cent of global CO2 emissions.[13]

In green concrete, the cement sand is partially replaced with certain industrial waste which ensures the same strength while lowering environmental impact. Such industrial waste can include fly ash, slag (waste product from steel mix) and quarry dust.

By replacing cement sand with industrial waste in green concrete, carbon emissions and energy consumption are reduced, whilst the durability and strength of the concrete is maintained. In certain green concrete products, carbon emissions were reduced by up to 50 percent.[14]

3. Straw Bale

Similar to clay plasters, straw bale is a traditional building material which has received a renewed interest in modern times for its sustainable characteristics. Certain modern architects such as

Werner Schmidt from Switzerland, specialize in multi-storey ecological building solutions which utilize load bearing straw bale constructions.[15]

Straw bales are made from a leftover waste product. After the edible part of grains are harvested, leftover stalks that are generally disposed of by farmers are bailed to make straw bales. Straw is a renewable product and its primary energy source is solar.[16]

In the form of straw bales, they gain a new life. Straw bales consume less energy compared to other materials such as fiberglass and synthetic wool.[17]

Straw bales can be used to construct both carcass walls for heat insulation purposes as well as load-bearing walls which bear the weight of the roof. Straw bales have high insulation qualities which allow them to keep the building warm in winter and cool in summer. If maintained properly, straw bale buildings may have a lifetime of up to 100 years.[18] At the end of its life cycle, straw bales are biodegradable and can be rendered back to earth.

Packaging

Packaging plays an important role in construction industry’s activities. It is used for storing, selling and transporting construction materials. To reduce waste and maintain circularity in its practices, the industry requires reusable packaging. At the end of its life cycle, the packaging should also be recyclable or biodegradable.

Horizon Armor® paper bags for construction products are fully recyclable, reusable, renewable and biodegradable. These bags are engineered to have robustness and long lasting protection for industrial packaging.

Made by Horizon, a reliable paper manufacturer.

References:

[1] Bonoli, A.; Zanni, S.; Serrano-Bernardo, F. Sustainability in Building and Construction within the Framework of Circular Cities and European New Green Deal. The Contribution of Concrete Recycling. Sustainability 2021, 13, 2139. https://doi.org/10.3390/su13042139

[2] Bonoli, A.; Zanni, S.; Serrano-Bernardo, F. Sustainability in Building and Construction within the Framework of Circular Cities and European New Green Deal. The Contribution of Concrete Recycling. Sustainability 2021, 13, 2139. https://doi.org/10.3390/su13042139

[3] Bonoli, A.; Zanni, S.; Serrano-Bernardo, F. Sustainability in Building and Construction within the Framework of Circular Cities and European New Green Deal. The Contribution of Concrete Recycling. Sustainability 2021, 13, 2139. https://doi.org/10.3390/su13042139

[4] Circular Economy Action Plan. (2020). European Commission.

[5] Bonoli, A.; Zanni, S.; Serrano-Bernardo, F. Sustainability in Building and Construction within the Framework of Circular Cities and European New Green Deal. The Contribution of Concrete Recycling. Sustainability 2021, 13, 2139. https://doi.org/10.3390/su13042139

[6] Circular Economy Action Plan. (2020). European Commission.

[7] RP (2020). Resource Efficiency and Climate Change: Material Efficiency Strategies for a Low-Carbon Future. Hertwich, E., Lifset, R., Pauliuk, S., Heeren, N. A report of the International Resource Panel. United Nations Environment Programme, Nairobi, Kenya

[8] Clayworks. Sustainability. [online] Available at: https://clay-works.com/sustainability/.

[9] https://www.kivira.fi/Esite/conluto/Clayplasters.pdf

[10] Clayworks. Sustainability. [online] Available at: https://clay-works.com/sustainability/.

[11] https://www.kivira.fi/Esite/conluto/Clayplasters.pdf

[12] Clayworks. Sustainability. [online] Available at: https://clay-works.com/sustainability/.

[13] Lehne, J. and Preston, F. (2018). Making Concrete Change: Innovation in Low-Carbon Cement and Concrete. [online] London: Chatham House. Available at: https://www.chathamhouse.org/sites/default/files/publications/research/2018-06-13-making-concrete-change-cement-lehne-preston.pdf.

[14] Skanska – Global corporate website. 2019. Making better mixes: Low-carbon and circular concrete | Skanska – Global corporate website. [online] Available at: https://group.skanska.com/media/articles/creating-better-mixes-low-carbon-and-circular-concrete/.

[15] Atelier Schmidt GmbH. [online] Available at: https://www.atelierschmidt.ch/.

[16] Paul Downton. 2013. Straw bale. YourHome. [online] Available at: https://www.yourhome.gov.au/materials/straw-bale.

[17] Säästvad Ehituslahendused. STRAW-BALE BUILDING. [online] Available at: https://www.ehituslahendused.ee/services/straw-bale-building.

[18] Paul Downton. 2013. Straw bale. YourHome. [online] Available at: https://www.yourhome.gov.au/materials/straw-bale.

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Circular Economy and the Packaging Value Chain

Nikhil Krishnan — Wed, 06 Jul 2022 07:35:55 +0000

For a long time, our world followed the linear economy model. This model follows the “take, make and dispose” steps:-

1. Take: Raw materials are procured to manufacture a product

2. Make: The product is manufactured and used

3. Dispose: Once the product is used, it is thrown away. This is because the product is not recyclable or designed for reuse. The product is treated as waste.

The traditional linear economy model has led to accumulation of excess waste over the years. Due to mass production, waste generation increased dramatically and has led to widespread pollution. Some waste such as plastic waste could take several years to decompose. This has put an unprecedented strain on our Environment and planet. By 2050, it is projected that we will be consuming materials and generating waste as if we had three planet Earths instead of one.[i]

The linear economy model is no longer an option for our finite planet. Our planet requires a more ecological model in which waste is minimized and products are recycled and reused for as long as possible. This is where the circular economy comes into picture.

What is Circular Economy?

Circular economy is an economic system in which the value of products and their raw materials are preserved for as long as possible.

Instead of the “take, make and dispose” steps, this model follows the “make, use and recycle” steps. In this way, the model aims to reduce waste and protect our Environment.

It also encourages sustainable economic growth. As per a recent study, it is estimated that applying circular economy initiatives in the EU economy can lead to an additional increase in the EU GDP by 0.5% by 2030 and creation of 700,000 new jobs.[ii]

Recognizing the potential environmental and economic advantages of circular economy in the EU, the European Commission has formulated the new Circular Economy Action Plan (CEAP) in 2020.[iii] This action plan outlines key initiatives that shall be considered along the entire product life cycle to ensure preservation of products’ values for as long as possible and waste minimization.

The CEAP recognizes that one of the key value chains in which circular economy can be effectively implemented is in the packaging industry.

The circular economy cycle in the packaging manufacturing industry is as follows:

In the product design phase, it is essential that the packaging is designed for reusability and high quality recycling. Moreover, it is important that the packaging is designed to contain less packaging materials to minimize waste. The manufacturing process should contribute to reduction in carbon and environmental footprints.

As a manufacturer of virgin sack kraft paper and paper bags, we contribute to the circular economy cycle of the packaging value chain in the EU.

By design, our virgin sack kraft paper and paper bags are fully recyclable, reusable, biodegradable and renewable. We manufacture our paper bags with our own manufactured sack kraft paper only, thereby extending the value of our paper to our paper bags and simplifying packaging materials used. We use 80% renewable energy in our manufacturing to reduce environmental footprint. Due to our paper bags consisting of long virgin fibers, our bags are strong and can be reused several times. Our bags can then be recycled and repulped, which allows for manufacturing of other paper based products in the European packaging value chain.

Even after you reuse our paper and paper bags, you can be assured that they take a new life in the form of other paper products after being recycled. Their value continues to be retained for as long as possible.

References:

[i] https://www.un.org/sustainabledevelopment/sustainable-consumption-production/

[ii] Impacts of circular economy policies on the labour market. (2018). Cambridge Econometrics, Trinomics, and ICF.

[iii] Circular Economy Action Plan. (2020). European Commission.

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