Raw Material Supply Chain
For most – if not all – of Resolute Forest Products’ stakeholders, the sustainability of our wood fiber supply chain represents a material interest. Customers, (E)NGOs, governments, members of the communities in which we operate, Aboriginal communities and others closely follow a range of issues – ranging from the consistency and quality of fiber available for product manufacturing to conservation priorities and sound environmental management in the forests where we harvest. Industry risks of illegal logging, conflict logging and harvesting that negatively impact endangered species or Aboriginal communities are also closely monitored.
Ensuring the traceability of 100% of the fiber we process is of paramount importance in the marketplace.
Chain of Custody Certification
Chain of custody (CoC) certification is a third-party confirmation that the company has the systems and controls necessary to track the source of certified fiber in its products.
All of our pulp and paper mills as well as wood products facilities have fiber-tracking systems in place that enable us to identify the source of the fiber or wood used. 100% of these tracking systems are third-party certified according to one or more of the following internationally recognized chain of custody standards1:
- Sustainable Forestry Initiative® (SFI®)
- Programme for the Endorsement of Forest Certification (PEFC)
- Forest Stewardship Council® (FSC®)
Internal and external audits are conducted at each of our operations on an annual basis. Discrepancies identified during the audit process are corrected and re-evaluated in subsequent audits. The constant evolution of CoC standards requires that Resolute comply with the latest science-based recommendations and requirements for our fiber sourcing areas and operations. The CoC certifications for each of our operations are renewed on a five-year basis. We are committed to maintaining 100% CoC certification across our operations, and in 2020, we completed certification audits for all of our Canadian CoC certificates, as well as multisite CoC certification for all of our tissue mills, including the Calhoun (Tennessee) mill's tissue operation.
Tracing our Products to the Source
For both our internal and external wood and fiber, 100% is sourced in accordance with SFI fiber sourcing requirements, PEFC CoC due diligence requirements or the FSC Controlled Wood standard, and in some cases a combination of these standards. All of these require 100% of the fiber processed meet minimum due diligence requirements related to risks of illegal logging and other important sustainability issues. This enables us to confirm to manufacturers and traders that they have avoided timber and timber products from unacceptable sources. Depending on the tracking system, additional requirements may apply that relate to high conservation values, conversion of forests to non-forest uses, propagation or use of genetically modified trees, corruption, indigenous rights and/or workers’ rights.
As a certified company, Resolute must take appropriate steps to ensure that it, and the suppliers and woodlot owners it sources from, all abide by a number of state, provincial and federal regulations, as well as voluntary best management practices that protect important ecosystem elements, including water quality, habitat for endangered species, and the suitability for recreation.
At our operations in the United States and Canada, deliveries of recovered fiber, roundwood and chips are tracked at the operational, regional and corporate levels with sophisticated software systems that convert on-site readings from truck weighing scales into accounts payable information, reports and other internal data uses. These systems are necessary to keep track of the approximately 700 external suppliers and more than $500 million in annual payments. Internal financial audits every two to three years maintain the continued robust reporting systems outlined in Resolute’s procurement policies.
In 2020, woodlands managed by the company provided approximately 49% of our required supply of wood fiber (chips and roundwood) for pulp and paper, with the remaining 51% purchased from external sources. Our Canadian sawmills source 100% of their wood from forests in Canada – mostly from Resolute’s managed forests (82%), and some from external suppliers. Fiber from our managed forests is harvested by employees and contractors in accordance with our carefully developed forest management plans and all applicable regulations. Virgin fiber harvested from other crown lands is also occasionally purchased from distributors. With respect to our U.S. sawmills, 100% of the fiber is sourced from American forests by external suppliers.
In 2020, 59% of the total fiber input for our pulp and paper mills consisted of sawmill by-products (wood chips) from Resolute’s own wood products operations and other facilities. An additional 4.3% of the total fiber used came from recovered paper collected and processed by external suppliers, as well as paper waste collected directly from commercial printing companies.
In Quebec, we purchase virgin fiber from private woodlot owners through brokers who maintain chain of custody tracking. In Ontario, virgin fiber purchases are made directly from private woodlot owners, while in the U.S., third-party suppliers work with private owners to harvest and deliver most of the fiber used at our operations.
1 With the exception of the Hagerstown (Maryland) tissue converting operation and the three U.S. sawmills acquired in 2020, the fiber sourcing systems of which will be certified in 2021