Manufacturing CEO On Thinking Globally: “The World Is Quite Small”

What are some of the initiatives you guys got going on with sustainability and green and really ensuring that you’re being environmentally sound?

We’re in an industry that is actually very much based on renewables and recycling of the products that we make. So our goals and our objective is to make sure that we get the maximum value out of every piece of material that we buy or bring in or consume, and that we get the maximum yield from it. We don’t waste any more product than we need. And whatever we do waste, we make sure that we can recycle it or reuse it or get more value out of it and put the least amount of product that we can into any waste or landfill. And so we’ve had goals over the years to continuously reduce that. And the cornerstone to that whole line of thinking is not only is it environmentally the right thing to do, it’s also the most efficient and cost-effective thing to do. The best-running operations that use the least amount of product are also the most cost-effective, along with probably being the most sustainable.

And we focus on three major categories: the people in our business, the planet and prosperity, you need all three. And a lot of people, when they talk sustainability, they get focus on just the planet. But we are a little broader than that. We have to look at not only the environmental side, but the sustainability of the business, which means you have to have a sustainable prosperity, it has to be a business that can renew itself. And you mentioned [old] mill towns [in New England]…so it’s devastating when you’re not in a sustainable business model.

Some of those towns are still feeling the ill-effects of the mills shutting down in the ’80s.

It’s critically important that we operate safely. And there’s one thing that is always on the top of my mind and I constantly think about, is the safety and well-being of our people. And we have a very rigorous, and very well-engrained safety culture. We operate with one of the lowest incidences of injury in the whole industry, and we continuously train. We have a goal of, minimum of 60 hours per person, every person, 60 hours of training per year, but we usually exceed that considerably. And we continuously work to make sure our folks are knowledgeable and capable of moving on in their jobs and continuing to build in their capabilities.

And on the prosperity side, you know, that’s why we made the investments in people, and why we make the investments in our businesses. I’m the only CEO still going here in the coated paper business after 11 years. And Sappi North America is the only coated paper business that hasn’t gone through bankruptcy or changed hands or closed. Every one of our competitors has gone through bankruptcy, shut-downs, closures…. every one of them.

I give a lot of that credit to us having that kind of view and understanding to being part of a global company, and Sappi’s culture. Because we’re looking at global trends all the time versus domestic trends. Even though 90% of what we manufacture here is sold and bought and used in North America, a lot of times there’s early signals that I see and pick up from Europe or from Asia or even from South Africa that we think about here, how it’s going to impact our customers, our business, and vice versa. That’s such a strength.

What’s your advice for your fellow CEOs?

I’m not the first one to say this, for sure, but one of the things I guess you don’t want to do, and I’ll start with one of those don’ts is you don’t want to try to be successful by trying to save yourself to prosperity. Obviously, you’ve got to manage your costs, but this is very much a long-term business model because it’s so capital intensive, the pulp and paper industry.

Don’t fall into the trap of cutting costs for a year or two so you can post really good numbers, which you could and then the whole bottom falls out from your business. Because you either cut way back on marketing and sales, or you didn’t maintain the assets. [This] is very much a heavy asset business, so you have to take care of your people, take care of your assets, take care of your customers.

You need to have a rolling five-year view on where your business is going and what you’re doing. And make sure that you’re constantly updating that every year.

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