Our Annual Integrated Report for the year ended 30 September 2023 provides an overview of how we create value in terms of our purpose, vision and strategy. The report deals with key opportunities and risks in our markets, our performance against financial and non-financial objectives and our priorities and expectations for the year ahead.
While the report addresses issues pertinent to a broad group of stakeholders, the primary audience is our shareholders. Our group and regional sustainability reports address a wider audience with more detail on stakeholder engagement and key material issues. In addition to our Integrated Report, we have included supporting appendices.
We understand that the long-term sustainability of our business will only be ensured by delivering sustained value for our stakeholders. In understanding our value-creation process, we take an integrated approach, considering Prosperity, People and Planet (the 3Ps) – an approach that is aligned with the International Integrated Reporting Framework (IIRC) six capitals model.
Intellectual capital: Our technology centres and research and development (R&D) initiatives promote a culture of innovation to support the development of commercially and environmentally sustainable solutions for the company.
Financial capital: We manage our financial capital, including shareholders' equity, debt and reinvested capital to maintain a solid balance between growth, profitability and liquidity.
Manufactured capital: Our operations require significant investments in manufactured capital. Investing in building, maintaining, operating and improving this infrastructure requires financial, human and intellectual capitals.
Human capital: We require engaged and productive employees to create value. By creating a safe and healthy workplace for our people in which diversity is encouraged and valued, and providing them with ongoing development opportunities, we enhance productivity and our ability to service global markets.
Social and relationship capital: Building relationships with our key stakeholders in a spirit of trust and mutual respect enhances both our licence to trade and our competitive advantage, thereby enabling shared value creation.
Natural capital: Recognising that our business depends on natural capital, we focus on understanding, managing and mitigating our impacts.
At Sappi, we take a holistic view of value creation. We understand that the long-term sustainability of our business will only be ensured by delivering sustained value for our stakeholders. Value for Sappi is not only about delivering returns to our shareholders, but also about maximising the value of every resource along our value chain to ensure those returns are sustainable. We recognise that our sphere of influence and impact extends beyond our mill gates.
Through this lifecycle approach that harnesses the power of the circular economy, we strive to minimise our negative impacts and increase our positive impacts on people and the planet, while securing sustainable profit margins. For more information on how we create value and our business model.
In understanding our value creation process, we take an integrated approach, considering the resources and relationships upon which we depend and impact, either positive or negative, through our business activities. Our value creation process is articulated through the lens of Prosperity, People and Planet (the 3Ps) – an approach aligned with six capitals model of the International Integrated Reporting <IR> Framework (2021).
The materiality of the information presented was determined based on extensive ongoing engagement with our stakeholders. It was assessed against the backdrop of current business operations and prevailing trends in our industry and the global economy. In line with the double materiality approach, our material issues aim to enhance our stakeholders' understanding of the impact of environmental and social issues on Sappi's enterprise value and the impact of our activities on the environment and society (refer to Our key material issues).
|One to two years, in line with immediate risks and opportunities
|Three to five years in line with management accounting’s five-year financial forecast plan
|Five to 30 years, taking into account the nature of our mill operations and capital investments for long-life assets, Sappi Forests’ research planning horizons in response to climate change and the EU’s plan for carbon neutrality by 2050.
Our Annual Integrated Report boundary
This report covers the period from the beginning of October 2022 to the end of September 2023.
We aim to present material, comparable, relevant and complete information. The issues and indicators we cover reflect our significant economic, environmental and social impacts and those we believe would substantively influence the assessments and decisions of investors.
Key to our materiality determination process is our reporting boundary. Our reporting boundary considers all our operations (refer to Where we operate). In addition, we consider the risks and opportunities beyond our financial reporting boundary that may significantly affect our ability to create value. These include material matters arising from our operating context, strategy, stakeholder issues, opportunities, risk management processes and SDG commitments, among others.
Our reporting suite
2022 Sappi Annual Integrated Report
2023 Sappi Group Sustainability Report
We obtained limited external assurance on selected sustainability key performance indicators in our 2023 Sappi Group Sustainability Report. The independent practitioner's limited assurance report is included in the 2023 Sappi Group Sustainability Report. Our sustainability information is verified by our internal audit team. Their verification process includes reviewing the procedures applied for collecting and/or measuring, calculating and validating non-financial data and reviewing reported information and supporting documentation. Most of our key operations undergo external verification, including the Eco-Management and Audit Scheme in Europe, ISO 50001 energy certification in Europe and South Africa and globally, ISO 45001 environmental certification, ISO 9001 quality certification and ISO 45001 health and safety certification. Some of our mills are certified to the ISO 22000 food safety management standard and EN 15593 management of hygiene in the production of packaging for foodstuffs.
We are assessed in terms of the forest certification systems we use and in South Africa, our broad-based black economic empowerment (BBBEE) performance is assessed by an external rating agency.
Collectively, these external assessments and certifications and interaction with our stakeholders give us confidence that our performance indicators are reliable, accurate and pertinent. The Social, Ethics, Transformation and Sustainability (SETS) Committee is satisfied that the sustainability information presented in this report has been provided with a reasonable degree of accuracy.
Our financial information is verified by our external auditors. For information on the combined assurance framework relevant to the disclosure in this report and the independent auditors' report, see Group Annual Financial Statements on www.sappi.com/annual-reports
The Sappi Limited board of directors (board) acknowledges its responsibility for ensuring the integrity of the Annual Integrated Report and, to the best of its knowledge and belief, the 2023 Sappi Annual Integrated Report addresses all issues material to the group's ability to create and preserve value in the short, medium and long term and fairly presents the group's integrated performance and outlook.
The board believes that the Annual Integrated Report has been prepared in accordance with the IR Framework and speaks to Sappi's use of and effect on the 3Ps (addressing value creation, preservation and erosion), which are aligned with the six capitals.
The board thus approved the 2023 Sappi Annual Integrated Report on 08 December 2023.
|Sir Nigel Rudd
|Chief Executive Officer (CEO)
In line with the International IR Framework, this report contains forward-looking statements to enable users to understand the challenges and uncertainties Sappi is likely to encounter in pursuing its strategy. This information is included throughout the report.
For important information relating to these forward-looking statements, refer to here.