4.2011 A MAGA ZINE FROM SCA ON TRENDS, MARKETS AND BUSINESS SHAPE SCA proposes Georgiato Georgia Pacific Good G ood against bad in the BACTERIA WAR FOCUS: GLOBAL G LOBAL HOTTIES O S How to enter new markets New Orleans after Katrina GREEN STUDENTS REBEL Elisabet Tapio Neuwirth Shape is a magazine from SCA, primarily geared toward customers, shareholders and analysts, but also for journalists, opinion leaders and others interested in SCA's business and development. Shape is published four times a year. The next issue is due in March 2012. Publisher Camilla Weiner Managing Editor Marita Sander Editorial Anna Gullers, Göran Lind, Anne Hammarskjöld, Appelberg Design Markus Ljungblom, Appelberg Printer Sörmlands Grafiska AB. Katrineholm Address SCA, Corporate Communications, Box 200, 101 23 Stockholm, Sweden. Telephone +46 8 7885100 Fax +46 8 6788130 SCA Shape is published in Swedish, English, Spanish, German, French, Dutch and Italian. The contents are printed on GraphoCote 90 gram from SCA. Reproduction only by permission of SCA Corporate Communications. The opinions expressed herein are those of the authors or persons interviewed and do not necessarily reflect the views of the editors or SCA. You can subscribe to SCA Shape or read it as a pdf at www.sca.com. Address changes can done at www.sca.com/subscribe or by e-mailing [email protected] OUR WRITER ON GOOD BACTERIA IN THIS ISSUE of Shape, journalist Elisabet Tapio Neuwirth takes a closer look at probiotics, the bacteria that are beneficial to human health (page 20). Tapio Neuwirth lives with her family in Sigtuna, just outside of Stockholm. In recent years, she has increasingly written about research, medicine and health – topics that require curiosity, accuracy and a dose of humility during encounters with patients, researchers and doctors. Among other as- signments, she has been a project manager for a Swedish cardiology journal and written numerous theme publications about cardio-pulmonary diseases for the Swedish Cardio-pulmonary Foundation, one of which was recently distributed as an audiobook. Tapio Neuwirth tries to live in the here and now by socializing with friends and family and sampling good music, food and books. For more physical gratification, she enjoys strength training and walking. THE CO-WORKER SCA’S SOCIAL MEDIA SITES Youtube.com/ SCAeveryday shows commercials and videos from SCA’s press conferences, presentations and interviews with executives and employees. Slideshare.com/ SCAeveryday is for investors and analysts, who can download presentations from quarterly reports and annual general meetings. Facebook.com/SCA is intended to attract talent, engage users and provide information in a way that complements sca.com. Scribd.com/ SCAeveryday makes some 50 publications available, including SCA’s sustainability report, its “Hygiene Matters” report and Shape magazine. 4.2011 A MAGA ZINE FROM SCA ON TRENDS, MARKETS AND BUSINESS SHAPE SCA proposes to GeorgiaPacific Good against bad in the BACTERIA WAR FOCUS: GLOBAL HOTTIES How to enter new markets New Orleans after Katrina GREEN STUDENTS REBEL Cover photo: Upload / Nordicphotos 2 SCA SHAPE 42011 Twitter.com/SCAeveryday provides a good summary of every thing happening at sca.com and in SCA’s social media. The aim is to provide various users, journalists and bloggers with relevant information. Flickr.com/ HygieneMatters supports the launch of the global report “Hygiene Matters” with images. 30 Wheels on wood. CONTENTS 06. Markets in the limelight Shape takes a look at the new economic dynamos in the world. 13. SCA in new markets Exciting growth opportunities in BRICIT countries. 16. Loos on his mind THE MILKY WAY. A baby's bacterial flora comes with milk. Eric Treurniet turns the public toilet into a shopping experience. 20 20. Good bacteria against bad Probiotics are bacteria that can make you healthier. 22. Student revolution in the US The hurricane brought a green awareness to New Orleans students. 27. Technology improved Östrand pulp mill replaces fuel oil with eco-friendly wood powder. 32. Nothing stays in Antarctica A sensitive environment means all waste must be removed. 40. Innovation mood SCA knows how to keep Moët & Chandon champagne cool. 04 ALSO.... SCA FLIRTS with Georgia-Pacific – page 4 GROWTH OPPORTUNITIES in focus – page 37 12 HOURS with Elin Olofsson – page 38 NEWS FROM SCA – page 41– 43 AT THE DOORSTEP. SCA partners with home care company in China. DO YOU KNOW... ...how often scientists on Antarctica receive supplies? See page 32. SCA SHAPE 32011 3 UPDATED SCA PROPOSES TO GEORGIA-PACIFIC SCA HAS DELIVERED a binding offer for Georgia-Pacific’s European tissue operations worth EUR 1.32bn. GeorgiaPacific’s European tissue operations have 5,000 employees and 15 production sites in seven countries and had sales of EUR 1.25bn in 2010. Consumer tissue accounts for some 60 percent of sales from Georgia-Pacific's European tissue operations, while Away-From-Home tissue accounts for about 30 percent. In their consumer tissue business, close to 70 percent of sales are branded products. “The business is a very good strategic fit for us and will strengthen our product offering and geographic reach in Europe,” says Jan Johansson, SCA’s president and CEO. “The deal will also lead to substantial synergies.” Annual synergies are estimated at EUR 125m, with full effect in three years after closing. With fully realized synergies, earnings per share are expected to increase by about 1.70 SEK. “It is an aggressive move in a defensive market,” Claes Rasmuson, an analyst at Swedbank, told the news agency Direkt. ! Close to 70 percent of Georgia-Pacific's sales in consumer tissue are branded products. China CHINESE ELDERLY CARE RIGHT TO THE DOOR SCA IS PARTNERING WITH a Singapore company, Econ Healthcare Group, to provide door-to-door home nursing services for the elderly in China. “For cultural reasons, most elderly people in China prefer to stay at home rather than in elderly homes,” says Stephan Dyckerhoff, president of SCA Hygiene North Asia. “This service is in line with the Chinese government’s plan to help 90 percent of elderly people stay in their homes.” A team of 10 nurses has already been recruited in Shanghai and trained for nearly three months. Econ Healthcare Group is a leading healthcare provider based in Singapore. SHARE OF SALES Forest Products Personal Care Forest Products Tissue Packaging 16% 36% Period: first 9 months of 2011 Personal Care Tissue Packaging 22% 23% 25% 4 SCA SHAPE 42011 SHARE OF OPERATING PROFIT 21% Period: first 9 months of 2011 27% 30% SEPTEMBER Nordic TISSUE MACHINE UPGRADE SCA QUALIFIES FOR CARBON DISCLOSURE LEADERSHIP INDEX SCA is investing SEK 460m in a tissue machine upgrade in the US to meet demand for premium products in that market. The machine has an annual capacity of 70,000 tons, which will remain unchanged. Production is estimated to start during late 2012 or early 2013. SCA HAS QUALIFIED FOR THE Carbon Disclosure Leadership Index for the second year in a row. The index recognizes 26 Nordic companies with the best reporting practices and performance to tackle carbon dioxide emissions and climate change. “We are proud to be included in the index,” says Patrik Isaksson, VP Environmental Affairs. “It’s a recognition that SCA has good internal data management and handles risk and opportunities in relation to climate change in the right way.” The index is based on a study of 260 companies in the Nordic countries that were asked about their information disclosure practices and performance on CO2 emissions and climate change. OCTOBER EFFICIENCY PROGRAM Read more: www.cdproject.net TENA AND TORK INCREASE MARKET SHARES Net sales for the first nine months of 2011 rose 6 percent, excluding exchange rates and divestments, as a result of higher prices and volumes. Including currency effects and divestments, sales declined 1 percent to SEK 79,001m (79,913). Operating profit for the first nine months of 2011 declined 1 percent, excluding restructuring costs and currency effects, compared with the year-earlier period. Higher prices and volumes, along with cost savings, compensated for most of the slightly more than SEK 3bn higher raw material costs, and higher costs for energy and distribution. The strengthening Did you wash of the Swedish krona had your hands extra carefully on Global Handa negative impact of SEK washing Day, October 15? 700m on operating profit. SCA and millions of Growth in hygiene people worldwide operations remained celebrated it. favorable in emerging markets, where sales of Tissue and Personal Care products rose 10 and 12 percent, respectively. So far this year, SCA’s global brands TENA (incontinence care) and Tork (AFH tissue) have increased their market shares. SCA initiated a restructuring program during the third quarter, primarily in hygiene and packaging, which will generate about SEK 700m in annual savings, within a two-year period. An efficiency enhancement program was launched during the third quarter, primarily in the Hygiene and Packaging operations. Total restructuring costs will amount to SEK 1,400m, including SEK 900m in items affecting cash flow. The measures will lead to annual savings of about SEK 700m in a two-year period. NOVEMBER PARTNER DOWN UNDER SCA forms a joint venture partnership for its existing operations in Australasia with the Australian company Pacific Equity Partners (PEP). “This deal secures our access to local competence and the local capital market and enables a faster development of the operations”, says Jan Johansson, CEO SCA. 1 SEK=0,11 EUR SCA SHAPE 32011 5 FOCUS: NEW MARKETS FEATURE The new high-rise buildings are symbols for the booming economy in China. Economic dynamos SHAKE THE WORLD The BRIC countries and other emerging markets are growing at rates that far eclipse those of the developed world. With their booming industrial output and rapidly expanding middle classes, foreign companies are eager to be present on the market. SCA has two strategies when making an entrance. TEX T: NANCY PICK PHOTOS: PER-ANDERS PETTERSSON, GETT Y IMAGES 6 SCA SHAPE 42011 Thousands of Chinese workers come from rural areas to cities to work, like here in central Lanzhou, China. SCA SHAPE 42011 7 STEPHAN SCHACHER, GALLERYSTOCK FOCUS: NEW MARKETS KNOWN BY THE ACRONYM BRICS, or BRICITs, they have the power to make the world’s current richest countries shake in their shoes. Brazil, Russia, India and China (sometimes Indonesia and Turkey are included) are on the rise. Together, they make up 40 percent of the world’s population and a quarter of its land area. By 2035, the combined economies of the six BRICIT countries will likely become larger than those of the world’s seven leading industrialized countries now. Of course, to succeed they will need stable politics and a dose of good luck, with global climate change something of a wild card. Across the world, the BRICITs and other countries experiencing rapid industrialization are called emerging markets. Typically, these dynamic economies boast an expanding middle class, a key factor for investors. By 2020, China alone is poised to have 1 billion citizens with middle-class incomes, whose purchases could drive economic expansion on a global scale. One complicating factor is that private consumption does not always match economic growth. In Russia, people tend to spend much of what they earn, partly because bank interest rates on savings fail to keep pace with inflation. In China, by contrast, households have a high rate of savings, in part because people must pay for a portion of their medical care. Recently, the Chinese government has said it plans to encourage more consumer spending. In addition to the BRICITs, economic analysts list as many as 40 emerging markets worldwide. Another leading dynamo is Mexico along with smaller markets like Egypt, Nigeria, the Philippines and Vietnam growing very fast. 8 SCA SHAPE 42011 In Brazil, the SCA category with by far the biggest potential is incontinence care. SCA tapping NEW MARKETS BRAZIL Gross national income, per capita: 9,400 US dollars (EUR 6,266) Economic growth rate, 2011: 3.9 percent Population: 195 million Aged 65+: 7.4 percent Shape magazine took a look at SCA’s business in four of the BRICIT countries, Brazil, Russia, China and Turkey. Of them, three boast annual per capita incomes above 9,000 US dollars, indicating a growing middle class. Although China’s per capita income remains much lower, it is rising fast, and its economy remains red hot. TEX T: NANCY PICK PHOTO: GALLERYSTOCK BRAZIL A LTHOUGH YOUNG com- pared to Europe, Brazil’s population is aging, with about 7 percent currently aged 65 or older. That’s a completely different picture from 20 years ago, when the elderly population was only a tiny minority. Brazil represents a new market for SCA. In September 2011, SCA acquired Pro Descart, a family-owned manufacturer near São Paolo with the No.2 position in Brazil’s incontinence care market. “We think that, in Brazil, the category with by far the biggest potential is incontinence care,” says Jan Schiavone, president of SCA South America. “Now that we have our own company, we intend to start growing fast.” As a factor in SCA’s favor, Brazil’s market for incontinence products remains fragmented, divided among many small companies. A typical family operation might manufacture incontinence care products for a limited local market, using a secondhand machine. Another key factor is government support. “The Brazilian government has launched a reimbursement program for healthcare necessities, including incontinence care, and this should help increase our sales,” Schiavone says. In terms of sales focus in Brazil, SCA is looking to individuals rather than to institutions like nursing homes. “In Latin America, most elderly people are cared for at home by their families,” Schiavone says. “That means most sales of incontinence care products are made through pharmacies and retail chains.” Besides incontinence care products, other areas with strong sales potential include baby diapers and Away-From-Home tissue, such as restaurant napkins. “Brazilians are starting to spend more and more time out of their homes,” he says. “Big chains like Starbucks and Applebee’s are coming, and that means this category will grow.” SCA SHAPE 42011 9 If you know how to deal with it, the inefficiency provides opportunities for good margins. RUSSIA S INCE THE FALL of Communism two decades ago, Russia’s consumers have become vastly more sophisticated, demanding choice and higher quality. While its middle class has grown, the country nonetheless displays some unusual consumer behavior, shaped partly by the huge gap between rich and poor. In addition, people tend to spend whatever money they have, making buying patterns somewhat inconsistent. Business in Russia brings both challenges and rewards. “In Russia, competition in many areas remains relatively weak, but you have a lot of other ‘enemies,’ like inefficiency and corruption,” says Ingolf Braun, general manager of SCA Hygiene Russia. “In fact, if you know how to deal with it, the inefficiency provides opportunities for good margins.” SCA HAS BEEN DOING BUSINESS in Russia for 17 years, longer than in emerging markets like Brazil, China or Turkey. SCA’s biggest Russian position is in tissue, with double-digit growth figures in the 1st half of 2010. SCA first entered the Russian tissue market in the mid-1990s, launching Libresse (feminine care) and Libero (baby diapers). Then in 1998, SCA purchased a tissue mill in Svetogorsk, close 10 SCA SHAPE 42011 to the Finnish border. Up until the mid-1990s only one type of toilet paper had been available, a very basic one-ply product. Initially, that was what SCA produced, becoming a market leader. Over time, as consumers began demanding higher quality, SCA began producing two- and three-ply toilet tissue, as well as Zewa hankies and household paper towels. NOT LONG AGO, SCA began building its own facto- ries in Russia. In 2010, SCA completed construction of its Sovetsk tissue mill south of Moscow that produces some 30,000 tons of toilet tissue annually. Plans call for tripling its capacity in 2013 by installing a second paper machine with a capacity of 60,000 tons per year, cementing SCA’s No.1 position in the market. In 2010, SCA opened a personal care factory in Veniov, where it manufactures Libero baby diapers and TENA incontinence care products. In baby diapers, says Braun, “the big boom is over, as there are not as many babies being born, and market penetration has reached a fairly high level. Now, growth is driven more by an increasing share of premium qualities.” As for the incontinence care market, “penetration is very low, and the market could grow up to 20 percent per year. We have the ambition to make TENA the No. 1 brand in Russia.” NORBERT WIESNETH, GALLERYSTOCK FOCUS: NEW MARKETS RUSSIA Gross national income, per capita: 9,900 US dollars (EUR 6,599) Economic growth rate, 2011: 4 percent Population: 142 million Aged 65+: 13 percent The Russians like it sophisticated and classy. The gap between rich and poor in Russia is big, but a growing number of Russians demand premium products. SCA SHAPE 42011 11 FEATURE TURKEY Gross national income, per capita: 9,900 US dollars (EUR 6,599) Economic growth rate, 2011: 8.8 percent Population: 73 million Age 65+: 6 percent The young Turks are modern and urban and like to shop. MARK HORN, GALLERYSTOCK 12 SCA SHAPE 42011 FOCUS: NEW MARKETS TURKEY Making an A YOUTHFUL NATION with a high birth rate, Turkey continues to rapidly modernize and urbanize, while seeing tremendous economic growth. Fired by entrepreneurial energy, the country has an expanding middle class enjoying its newfound purchasing power. Women, however, remain underrepresented in the workforce. In Turkey, SCA is moving fast into a broad range of hygiene products, with baby diapers and feminine protection taking priority, while incontinence care shows room for rapid growth. “Turkey is very dynamic,” says Håkan Molin, vice president for SCA Middle East, Africa and Turkey. “It’s an interesting place for us to be, a potential hub for big and small markets in the Middle East and Central Asia.” In July of 2011, SCA bought 50 percent of Komili, the fourth-largest producer of baby diapers in Turkey. Komili – owned by Yıldız Holding, the largest Turkish food group – sells baby diapers under the Baby Star brand and feminine protection under the Rozi brand. In Turkey, sales of these categories continue to grow. EVEN MORE INTERESTINGLY, Komili also produces toiletries like soaps and shampoos, providing an opportunity for SCA to expand its hygiene offering. “It’s exciting for us to enter a new category,” Molin says. Also in the summer of 2011, SCA acquired 95 percent of San Sağlık, the second-largest producer of incontinence care products in Turkey. Under its Glory brand, the company sells mainly to hospitals, pharmacies and medical supply stores. Distribution through retail chains remains a promising option, still unexplored. Initially, SCA considered entering the Turkish market more than a decade ago, but it got discouraged by the country’s fi nancial crisis of 2000-2001. Since then, the country has worked hard to stabilize its banking system and keep inflation under control. “Investing in Turkey is not without risks,” says Molin, “but the country’s track record over the past 10 years has been extraordinarily strong.” ENTRANCE MARIA DURON SCA vice president for strategy processes When entering a hot new market, local partnerships are crucial for SCA. TO RUSH IN and build a manufac- turing plant is not SCA’s strategy when it wants to enter a new market. Before choosing a site, SCA studies the global landscape, looking for countries with a rising middle class. “That’s one of the main drivers for us, because economic growth leads to domestic consumption,” says Maria Duron, SCA vice president for strategy processes in Stockholm. No matter how fast it is growing, the country must also demonstrate reasonable stability—both political and financial. When entering a new market, SCA typically chooses between two approaches. In one, SCA creates a joint venture partnership with a local company that offers both production capacity and distribution ability. Alternatively, SCA builds up the market by partnering with a local manufacturer until there is enough volume for SCA to justify building its own factory. “In China we have chosen to combine both approaches, in order to get on our feet quickly and harness the country’s growth,” says Ulf Söderström, president of SCA Asia Pacific. When entering the market in Turkey, SCA was looking for a suitable partner from the beginning. “Big family companies dominate Turkish business, and it’s not easy to enter in this market,” says Håkan Molin, vice president for SCA Middle East, Africa and Turkey. “Local partners come with established distribution networks, strong brands and a base for manufacturing, which is of course very helpful.” GENERALLY, SCA isn’t the only major company scouting for opportunities. “In places like China, Russia and Brazil, the main multinational competitors are already there, often in addition to strong regional or local players,” Duron says. To ensure profitability, SCA looks for categories with high growth potential combined with low market penetration. SCA SHAPE 42011 13 In any discussion about incontinence, SCA brings a lot of expertise to the table. STEPHEN WILKES, GALLERYSTOCK CHINA CHINA Gross national income, per capita: 4,300 US dollars (EUR 2,866) Economic growth rate, 2011: 9.5 percent Population: 1.34 billion Age 65+: 8 percent I T’S NOT EXACTLY a secret that China’s economy is booming. The fast-developing economy in this region means that people have increasingly more money to spend. Yet the progress is spread unevenly, with the earnings gap between urban and rural workers wider than ever. Over the last few years, SCA has begun positioning itself to take advantage of China’s growth, with top priorities being TENA (incontinence care) and Tork (Away-From-Home tissue such as restaurant napkins). “China is amazing,” says Ulf Söderström, president of SCA Asia Pacific, who is based in Shanghai. “If you look at the next five years, 66 percent of the growth in hygiene products will come from the Asia Pacific region, and most of that will be in China. The booming economy in this region means that people can spend more money, especially on hygiene products. This provides a good base for our business.” SCA does not operate its own factories in China – yet. To date, SCA’s biggest investment in the country has been buying 19 percent of Vinda. Hong Kong-based Vinda is the fourth-largest tissue producer in China. This was a wise move for SCA, given that consumer tissue is now the fastest-growing hygiene category in China. Two years ago, SCA also began selling incontinence care products in China, and “sales are taking off really fast,” Söderström says. Here, government involvement plays an important role. “In its latest five-year plan, the Chinese government placed elderly care very high on its priority list. In any discussion about incontinence, SCA brings a lot of expertise to the table.” Feminine protection may have the least growth potential in the hygiene domain, as market penetration is already high. However, for all other hygiene products, penetration remains quite low. “This means that we have great opportunities here,” Söderström says. For now, SCA’s business in China remains relatively small, but it’s unlikely to stay that way. SCA is developing its distribution channels, and ultimately, he says, “the plan is to make China a big part of our global hygiene business.” 10 QUESTIONS Tribute TO THE LOO Eric Treurniet is the founder of the new toilet shop company 2theloo, which offers facilities on shopping streets and at gas stations, train stations and malls. Based in Amsterdam, the start-up company is growing fast. TEX T: NANCY PICK PHOTOS: MALOU VAN BREEVOORT Treurniet – is your name French? “No, it’s a Dutch name that means ‘don’t be sad’.” Well, you shouldn’t be, considering the success with your company. How did you get the idea for 2theloo? “The idea came to me when I was in Bruges, in Belgium, shopping with my wife and kids. At several points we were looking for a toilet, and then at the end of the day we were walking down a shopping street and I saw an empty storefront. I thought, ‘We’ve been looking for a toilet so many times now today, why not start a toilet store?’ That was at the end of 2009.” 16 SCA SHAPE 42011 SCA – A PREMIUM PARTNER Eric Treurniet Age: 41 Family: Married. His wife works in the family business, and they have two daughters, ages 3 and 6. Lives: In Bussum, outside Amsterdam. Education: He studied law at the University of Amsterdam. Hobbies: Sports has always been his passion, and he plays tennis and golf. SCA has been a partner with 2theloo since it began in February 2011. “We went looking for a company with a green profile, because we believe in sustainability,” says 2theloo founder Eric Treurniet. It turned out to be a good match. “SCA was the first company that really believed in our idea,” he says. 2theloo uses Tork tissue in all its toilet facilities. Its shops sell a range of SCA consumer products, from Libresse sanitary pads to Tempo handkerchiefs. 2theloo is also experimenting with co-branding together with SCA. Initially, the shops are offering small packages of diapers, two per pack, under the 2theloo name. “It’s a logical partnership,” Treurniet says. SCA SHAPE 42011 17 10 QUESTIONS Condoms, tampons or stuff you might need when going to the loo, or need while shopping, are sold in the toilet shops. What is a toilet store? Is it anything like the freestanding public pay toilets you see on city streets? “The concept is a combination of a retail shop and a toilet facility. The retail we offer is always relevant, stuff you might need when you go to the loo. You can buy tampons, or items ladies use while standing in front of the mirror. Or things you might need while walking and shopping, like toothpicks after a meal. Often, the products are in sort of funny packaging—for example, our mineral water is called 2thel’eau. “We hired a Dutch design agency to assist us in translating our ideas. We want to make 2theloo into an experience, different from any other toilet facility. We think that when you enter the toilet, you should be surprised. The walls of the stalls might have pictures of people taking a peek at you. Or animals looking at you, like ostriches. We’re opening a store in Utrecht that has a picture of the White House. When you sit down, you’re sitting on the lawn of the White House.” What were you doing before you started 2theloo? “I was a partner at a sports marketing agency, PRO SPORT. We advised sports organizations about media, and we set up competitions. When the idea for 2theloo came to me, I had a conversation early in the process with my current partner, Almar Holtz. He was working at Disney, in charge of consumer goods for the African continent. He became enthusiastic about the 2theloo idea as well. That was where we started. 18 SCA SHAPE 42011 “Women spend an average of 1.5 minutes using the toilet, and men only 40 seconds.” Eric Treurniet Then we consulted PricewaterhouseCoopers for the business phase, and it turned out they found the idea interesting.” Humor seems essential to your marketing strategy — like the company name… “In the UK, ‘too-da-loo’ is a well-known expression, meaning ‘goodbye.’ Quite a lot of people in the Netherlands use this phrase as well. So 2theloo has a double meaning. I think it works as a brand.” So it seems your company is growing fast? “We launched in February 2011 and we’ve been very busy. Currently we have 10 shops operational, with six more opening this year, and in 2012 we expect to open about 50. Beyond the Netherlands, we’ll have locations in Belgium, the UK, France, Spain, Portugal, Germany, Poland and Israel. We’re also negotiating deals in Scandinavia, Lithuania and Russia. “The largest facility is located in a shopping mall, close to Antwerp. It has a total of 35 toilets, of which about 20 are for women, 10 are for men, and five are a combined ‘family room,’ as we call it. Each family room has a large toilet for mom and dad, and a small toilet for the kids. You’re divided by a narrow vertical wall, so you can see your parent sitting next to you.“ An interesting concept. So in general, women need more toilets? “If you look at global averages, women use the toilet seven or eight times a day, compared to five or six for men. Also, women spend an average of 1.5 minutes using the toilet, and men only 40 seconds. Plus our facilities are positioned in areas where women are over-represented, like shopping malls.” How much does it cost to use your facilities? “The toilet costs 1 euro in our flagship shop in Amsterdam. Most of the other locations cost 50 euro cents. Plus you get a 50-cent discount voucher for the shop, so basically, you’re using the loo for free.” Are you ever embarrassed about your line of work, when you run into old friends? “No, I’m not embarrassed because we’re a successful operation. People think 2theloo is cool and fun.” Do you tell toilet jokes? “I’m more of a listener, not the one telling the jokes. I think what’s unusual about me is that I’m creative. Not that I’m a painter or a musician, not at all, but in a business sense.” FEATURE “We think that when you enter the toilet, you should be surprised.” Eric Treurniet A family room has a normal-sized toilet for grown-ups and another small toilet for kids, like the one Eric is trying out. SCA SHAPE 42011 19 MARKET Are our modern lifestyles "too clean" for our health? Some suggest that dirtier homes and uncleaned and unprocessed food would promote our health. BACTERIA to stay healthy It’s an ongoing tug-of-war between good and bad bacteria. Probiotics are attracting considerable interest around the world, with attention focused on the struggle between “healthy” and “unhealthy” microorganisms in the body’s ingenious ecosystem. TEXT: ELISABET TAPIO NEUWIRTH PHOTOS: GETTY IMAGES DOES THE BACTERIAL FLORA of humans constitute an organ on its own? Indeed, there are scientists who would like to assign that title to the billions of bacteria living and flourishing in the stomach and gastrointestinal tract. The bacteria are invisible to the naked eye but are immensely important since they constitute part of our immune defense system, providing protection against pathogenic organisms and fighting off infections and illnesses. Healthy bacterial flora contains and can fend off continual attacks from “bad” bacteria, but in some cases an imbalance may arise, with the bad bacteria getting the upper hand. In the quest for ways 20 SCA SHAPE 42011 to reestablish balance in the bacterial flora, researchers around the world have studied probiotic bacteria, living microorganisms that, in the right quantities, have a positive effect on people’s health. A Swedish biotech company has taken a great step forward in this field by carefully identifying and clinically studying the bacterial strain Lactobacillus reuteri, which originates in breast milk. “When a baby is born, it has no developed bacterial flora of its own,” says Peter Rothschild, managing director of the company BioGaia in Stockholm. “But in childbirth, the baby is exposed to the mother’s bacterial flora in her vagina and digestive tract, FEATURE and the baby takes in further bacteria through breast milk – in a balance of both good and bad – that help develop its immune system. The bacterial flora is usually fully developed by the time the child is about 1 year old. “In that way, breast milk is fantastic also for those of us who work with developing and producing probiotic products.” The intestinal flora is very important to our health, but in order for probiotics to have a real benefit, the right bacteria have to end up in the right place in the body’s advanced ecosystem, Rothschild explains. “Over the years, we’ve studied Lactobacillus reuteri very closely and found a variety of strains in the species, all of which have different functions in the body,” he says. “One could be to counteract the stomach bacterium Helicobacter pylori, another the formation of plaque on the teeth. In our studies, we’re also investigating how many bacteria are needed to have an effect. Every species has to adjust to its target area.” SOME STUDIES suggest that our modern, clean life- style is one cause of the imbalance in our bacterial flora. Unlike previous generations, we eat food that is cleaned and processed, then boiled or baked. We clean our homes and gargle with antibacterial agents. We smoke, drink alcohol and have stressful lives, which all have an adverse effect on the bacteria. And when we get really sick, we take antibiotics, which are effective in killing bacteria but do not distinguish between good and bad ones. The digestive tract consists of two pounds (one kilogram) of bacteria from a thousand or so different strains, and after a round of antibiotics it can take up to six months for the bacterial flora to recover. A person may suffer from stomach pains while undergoing treatment with antibiotics, which can cause people to stop the treatment too soon. “That should never be done because the bad bacteria, the pathogens, will do anything to survive and can therefore become resistant to the antibiotics, which could ultimately lead to the development of multi-resistant bacteria,” Rothschild says. “Our studies show that if probiotics are taken together with an antibiotic, people rarely suffer any side effects, and that may help motivate people to complete the treatment. If they continue to take probiotics afterwards, their bodies will also have a chance to restore the bacterial flora. “Or you take probiotics as a preventive measure,” he says. “That way, you simply stay healthier.” PROBIOTIC PRODUCTS IN THE PERSONAL CARE MARKET “Breast milk is fantastic also for those of us who work with developing and producing probiotic products.” Peter Rothschild, managing director of BioGaia. BioGaia is a world leader in probiotic bacteria products, working closely with doctors around the world and selling its products mainly in drugstores. SCA and BioGaia have signed a longterm partnership agreement to develop new products in the future with a focus on health. SCA is a leader in incontinence protection and elderly care. BioGaia’s main focus is digestive and oral health, and the company continues to develop in other health fields. “We’re not there yet, but together we’re looking for new ways to combine our core areas,” says Rolf Andersson, senior hygiene adviser at SCA. The microflora in the digestive tract changes as a person ages, which can lead to diarrhea and/or constipation, which is common among older people. By adding probiotic stomach bacteria, the microflora can be restored, thus improving the well-being and quality of life of such people. “We are building a great deal here on BioGaia’s experience with probiotic bacteria while at the same time maintaining great focus on the needs of older people,” Andersson notes. Another area where a partnership could be rewarding is urinary tract infections (UTI). The risk of being affected increases as a person gets older, especially for women who are urineincontinent. Production of beneficial lactic acid bacteria declines after menopause, and as a result many women lose natural protection in their urinary tract. So some bacteria have an easier time becoming established in the area, causing UTI. “One way to prevent the development of UTI could be to add probiotic lactic acid bacteria and thus restore the microbiological balance. The partnership is very exciting, and we see unlimited opportunities in product development,” Andersson says. BioGaia’s main focus is digestive and oral health, but the company continues to develop in other health fields. SCA SHAPE 32011 21 FEATURE Laney White, past president of the Tulane Environmental Action League. FEATURE Green student REVOLUTION TEX T: THETA PAVIS PHOTO: PONTUS HÖÖK University students in a city that was devastated by Hurricane Katrina came back from the disaster with a renewed commitment to protecting the environment. MARKET Being there post-Katrina was a big wake-up call... IN 2009, White and other students work- S TUDENTS WHO ATTEND Tulane University have plenty of good reasons to go there. It’s a rigorous, top-ranked private school set in a beautiful campus covered with enormous live oak trees. It’s also right in the middle of a city that is still recovering from one of the worst natural disasters to ever hit the United States – and surprisingly, some students like that. After Hurricane Katrina slammed into the city in 2005, 80 percent of New Orleans was underwater and the Tulane campus was shut down for only the second time in its history. Some worried that students would never come back, but those who did seemed committed to making a difference. While the school has a history of public service dating back to the 1960s, Katrina seems to have strengthened that commitment. One place where you can see this is in the environmental activism of Tulane’s undergraduates. “Being there post-Katrina was a big wake-up call to the fact that we were 24 SCA SHAPE 42011 ing with TEAL learned of a Greenpeace campaign aimed at stopping a large paper manufacturer from sourcing its products from old-growth forests. Students found that the university was getting its toilet paper and other products from that company, and they asked the school to find a more environmentally sound alternative. The university was receptive but told the undergraduates they would have to do the research themselves. Undeterred, the students pored over the research and then contacted SCA about the Tork brand of products which are made from 100 percent recycled content. “The students had a concern and did the research to propose a solution,” says Liz Davey, Tulane environmental affairs director. “It was impressive how they worked with the salesmen and learned about who in the university makes these decisions and what the criteria are. That is the work of sustainability – for each piece of our daily lives, looking at it thoughtfully and looking at the alternatives and what it takes to make the change. It was a really good case of student activism.” In the end, with the hard work of the students, Tulane switched to Tork products. Luke LaVanway, the current TEAL president, was an officer in the organization during the campaign. Now 21 and majoring in political science, he hopes more people will get involved in this work. “I think environmental activism is a great way for anyone who wants to give back,” he says. “Instead of just working at schools and hospitals, why not the environment? It needs care too. I think more people should see environmentalism as a way of giving back to the community.” The students’ concern dovetailed nicely with the university’s efforts to get some of SCA supported the Gulf oil spill cleanup. Tork wipers were used onboard boats to help sanitize equipment and clean tools, and for general cleaning applications. PHOTO: SCA on the front lines of global warming,” says Laney White, 24, past president of the Tulane Environmental Action League (TEAL). “The students are more idealistic, especially in New Orleans, because they wanted to help rebuild.” AID TO THE AREA BESIDES PROVIDING Tulane’s campus with tissue products, SCA has another connection to the New Orleans area. In the fall of 2010, SCA donated more than US 200,000 dollars of Tork products to support the massive Gulf The Tulane students’ environmental concern has made some of the campus bulidings LEED certified. Coast oil spill cleanup efforts. SCA donated wiper products for the cleanup through the Gifts In Kind International organization. The wipers were used by nonprofit and grassroots volunteer groups to aid in the cleanup and disaster relief efforts. “Supporting the Gulf oil spill cleanup is one of the many ways we demonstrate our longstanding commitment to improving the environment, while showing we care for the communities where we live and operate,” says Don Lewis, president, SCA Tissue North America. SCA entered the North American market in 2001. its buildings LEED certified. So far Tulane has one certified building. “We have an overall goal of reducing our greenhouse gas emissions, and we are working to achieve LEED certification in all major construction and renovation projects,” Davey says. The students’ environmental concern over the tissue products “helped move us down the road toward certifying buildings,” she says. LEED certification is a complicated process that takes into account every aspect of a building, including its impact on the surrounding area and the products used inside. In fact, the use of Tork paper products can be used to meet LEED certification criteria. LaVanway says the campaign that brought Tork products to campus shows that people care about corporate practices and their environmental impact. “SCA’s Tork products were a great alternative,” he says. “We ended up using their recycled products.” White, who stayed in New Orleans after graduation to sign on with AmeriCorps VISTA (sometimes called the “domestic Peace Corps”), works with a national nonprofit, Global Green USA, helping low-income families. She says it was exciting to see a grassroots campaign successfully change a large market. “We came in with a plan, and the university was trying to green its image. They were excited that students were getting involved. It all happened really quickly.” Meanwhile, the work of rebuilding the community in New Orleans and creating a greener campus continues. After Katrina, Tulane added a unique public service requirement to the undergraduate curriculum. Students have to take a class and then do a service project, which can be another class, an internship or a research project, Davey says. “There are more students here now than have ever been on campus before,” she says. “There’s tremendous interest in Tulane after Katrina, in part because of the service requirement. And there is a sense of wanting to be a part of history and wanting to help bring the city back, and making it a stronger community.” SCA SHAPE 42011 25 I love being pregnant. I’m always guaranteed to get a seat. People always offering to give up their seat, I could get used to this. That, and the glossy hair, the strong nails and glowing skin. There are certainly some advantages to being pregnant. Unfortunately the pressure on my bladder isn’t one of them. But there is no way I’d let a little bladder weakness stop me from enjoying this special time in my life. TENA liners and pads are specifically designed to absorb the thinner faster flow of slight bladder weakness, with the added benefit of odour control. So that you feel fresh and confident throughout the day. For a free sample visit TENA.com.au TECHNOLOGY Replacing this tube with a new one reduced the carbon dioxide footprint by 80 percent. Turn page and se how. Double gain from a new lime kiln Even before its commissioning, the new lime kiln at SCA’s Östrand pulp mill is attracting a lot of interest. It is the first in the world to substitute fuel oil for wood powder, which is eco-friendly – and cheaper. TEX T: ULF WIMAN PHOTO: MATHIAS JOHANSSON TECHNOLOGY T HE SCA ÖSTRAND PULP MILL in Timrå, 390 kilometers north of Stockholm, is a major producer of totally chlorine free bleached sulfate kraft pulp. About half the mill’s output is used for the SCA Group’s own needs to manufacture publication paper and hygiene products, and the rest is sold to external customers. The Östrand mill also produces CTMP (chemical thermo-mechanical pulp) for hygiene, packaging and other products. Partly out of environmental considerations and partly with an eye to the mill’s future capacity needs, SCA Östrand decided to install a large new lime kiln to replace the two existing oil-fired ones. Lime kilns play an important part in the chemical recovery process at sulfate pulp mills. They convert lime sludge, a waste product from the process that consists mainly of calcium carbonate, into calcium oxide that is reused in the pulp production process. The construction of Östrand’s new lime kiln, one of the largest in Europe, started in 2010. By early autumn of 2011 the machines were in place. If the first tests meet the objective – 24/7 operation without downtime due to the machine – production proper will start. “The equipment isn’t exactly rocket science,” says Håkan Wänglund, project manager. “The challenge is rather that we will run the lime kiln on pulverized fuel pellets instead of the fuel oil that all other lime kilns use.” In fact, the Östrand lime kiln is the first one globally to run entirely on wood powder. So what was the reason for choosing this solution? “First of all, using fuel oil isn’t environmentally friendly,” Wänglund says. “On top of that, oil prices are high and we have no control over them. Now we’ll reduce our yearly fuel oil consumption by 17,000 cubic meters. We’ll save a lot of money, but we’ll also reduce our carbon footprint by 80 percent.” “We’ll save a lot of money, but we’ll also reduce our carbon footprint by 80 percent”. Inside this tube are two brick layers. The one closer to the metal cover is for insulation, while the inner one is for wear resistance. The new lime kiln at the SCA Östrand pulp mill in Timrå is basically a steel tube 125 meters long and 4.5 meters wide. Brick layer Brick layer 125 m 4.5 m 5m 28 SCA SHAPE 42011 The tube rests horizontally at a 1.4-degree angle on four bearings about five meters above the ground. ILLUSTRATION: KJELL THORSSON What’s more, the wood powder that will be used is part of an SCA business loop. The fuel pellets that Östrand uses to grind to wood powder are made from sawdust from SCA’s sawmills in Sundsvall and elsewhere. The sawdust is made into fuel pellets by SCA’s plant in Härnösand, 39 kilometers west-northwest of Timrå. The same trucks that bring sawdust to the pellet mill, brings pellets back to the pulpmill, thus avoiding empty runs. “Everybody wins, as does the environment,” Wänglund says. Besides the considerable environmental gains, the other main reason for installing the new lime kiln is that Östrand’s existing two lime kilns are hitting their capacity ceiling. There is simply no capacity left to grow the operation to the significantly increased output levels that the pulp mill plans for the future. This problem is solved with the new lime kiln, which has capacity well beyond current needs. “When the new lime kiln is in place, the pulp mill can increase its production by 10,000 metric tonnes a year,” Wänglund says. “Looking to the future, the lime kiln has the capacity to match the need for a production of 800,000 tonnes of craft pulp, almost twice the present production.” Having one high-capacity lime kiln instead of two smaller ones aligns with another long-term SCA objective – to rely on one machine per process phase and still increase output. There is yet another loop in the system, one that Wänglund says is quite uncommon. “The sulfate process produces odorous gases,” he says. “These will be collected and routed back to the burner in a canal system. Not only does this reduce the smell, but the gas is rich in energy, which we’ll recover.” The project has caused a stir in the industry. This is not surprising, since all kraft pulp mills want to improve their sustainability as well as reduce their fuel oil consumption. “A lot of our colleagues around the world have contacted us to learn more about what we’re doing,” Wänglund says. A HOT PROCESS The lime sludge, which mainly consists of calcium carbonate, is fed at the top end. On its way down through the rotating tube it gets increasingly hot. When it reaches a temperature of 1,100 degrees centigrade, it is converted into calcium oxide. Using wood powder for fuel instead of the traditional fuel oil, Östrand faces a challenge to get the kiln flame to burn with the right intensity, which is crucial for the process. With fuel oil, which has an even quality, this is rather easy. This is not the case with the wood powder. There is a risk that the size of the wood powder corns vary over time. To secure a stable process, the powder must have an even size no larger than 1 millimetre in diameter. The tube rotates slowly during the process. At the tube’s lower end is a giant 55-megawatt burner, almost 10 meters long. SCA SHAPE 42011 29 SHAPE UP EVERLASTING SHOWER WHAT WOULD YOU THINK of shower- ing for eight minutes using just 8.5 liters of water? That idea is no longer a dream. A student from Lund Institute of Technology in Sweden has made a prototype for just such a shower. The 2 ¼ gallons can be used over and over again and are cleaned between each cycle. The shower consists of a filter DANGEROUS, MORE DANGEROUS THE MOVIE Contagion, which premiered in October, is about an extremely infectious and deadly virus that spreads fear and claims lives across the world. The film is just one in a long line of similar doomsday scenarios involving infectious diseases that have been shown in movie theaters over the past few decades. Perhaps it’s because we’ve seen so many films of this type that we are quick to heed recommendations by authorities to wash our hands and use hand sanitizers to guard against flu epidemics and the outbreak of the winter vomiting bug. 30 SCA SHAPE 42011 made of electropositive nano-aluminum fibers, a technology developed by NASA for cleaning water in space. The fibers attract all kinds of particles, including bacteria and viruses, and the filter only needs changing after about 30,000 gallons. In order to further extend its life, the filter is combined with a washable pre-filter. Ride with style “Vespa Daniela,” made entirely of wood, is a masterpiece of Portuguese carpenter Carlos Alberto. The motorbike is named after his daughter. Meatless Mondays for the climate THE CHAIRMAN OF THE UN Intergov- ernmental Panel on Climate Change, Rajendra K. Pachauri, who is also a Nobel Peace Prize laureate, gives up meat on Mondays. One initiative that is spreading internationally is to eat vegetarian one day a week – preferably on Monday. The “Meat Free Mondays” campaign aims to help the climate and promote good DID YOU KNOW THAT… health with meatless Mondays. A growing number of individuals, restaurants, schools, companies and others have accepted the challenge, which is an initiative from The Monday Campaigns movement, which is encouraging Americans to make smart choices that benefit their health and well-being at the beginning of each week. THE WORD “HYGIENE” comes from the Greek Hygeia, the name of the goddess of health. Hygeia was the daughter of Asclepius, the Greek god of medicine, and is usually depicted with a snake in her hands. Dogs sniff out sick fir trees SICK TREES in the forest can be tracked down by dogs trained to recognize the scent of firs that have been attacked by bark beetles. In a study from the Swedish University of Agricultural Sciences, dogs could track down a tree under attack from a distance of 150 yards. Forests carry a big climate load We know that the world’s forests are enormously important for the climate. But a new study published in Science magazine shows that their ability to store carbon and absorb carbon dioxide is far greater than previously understood. The world’s forests absorb 2.4 billion metric tons of carbon each year —equivalent to nearly a third of the annual carbon dioxide emissions caused by human burning of fossil fuels. By far of greatest importance for the climate are the endangered rain forests, which alone account for about half of total carbon uptake, even though they cover less than a tenth of the Earth’s surface. SCA SHAPE 42011 31 FEATURE Frozen ASSETS Nothing stays on the ice. At Scott Base in Antarctica, waste management is at its most extreme. Anything brought to the research base has to be either consumed or shipped back to mainland New Zealand. Here, sustainability is essential. TEX T: SUSANNA LINDGREN PHOTO: WENDY CL AVANO. KEN RYAN AND NANCY COX, ANTARCTICA NEW ZEAL AND PICTORIAL COLLECTION 32 SCA SHAPE 32011 OUTLOOK Bad weather during field training. It takes ten days to sail from Christchurch to Antarctica. Planning the cargo is a challenge, as the next shipment will only come in 12 months. T THE ENVIRONMENT AT Scott Base, New Zealand’s permanent research support center in Antarctica, is extreme in many ways. With a mean temperature of –19.6˚C, the summer temperature only occasionally goes above freezing, and in wintertime the thermometer can show –57˚C. Add the wind to that and try to imagine how harsh the conditions can be. The base is exposed to the full strength of southerly blizzards, and winds have been recorded in gusts up to 185 kilometers per hour. In spite of these extreme conditions, a staff of 13 stays at the base all year round. “But they rarely stay more than one season,” says Michael Nottage, who works for Antarctic New Zealand. As purchasing officer for the Scott Base, he has visited the research center 15 times, and like nearly everyone else he has chosen to do so during the southern hemisphere summer, from October to February. During those months, research teams focused on climate change, animal life, glaciers, the dry valley vegetation, seawater research and other topics visit for various lengths of time, depending on the research and planned expeditions. The base works a bit like a boarding hostel, with shared bedrooms, one large dining room and an industrial kitchen complete with chefs. In the summer the base has a transient population of around 60-plus staff, and about 80 people can be accommodated at the same time. SCA SHAPE 42011 33 OUTLOOK In times of need: The toilet tent at field camp. New Zealand Scott Base rugby team in action. “All that waste is transported in containers and shipped back frozen”. From Scott Base it is closer to the South Pole (1,353 kilometers) than to Christchurch (3,832 kilometers), where Antarctic New Zealand has its operational offices. Due to this remote location, a lot of planning is required to make sure that supplies of food, heat, electricity and freshwater are maintained, especially since big shipments of everything from food and toilet tissue to spare parts for machinery arrive only once a year. “The biggest challenge is in the planning, to make sure we order the right amount, get what we ordered and get it on time,” Nottage says. The annual shipment from Christchurch to Antarctica takes about 10 days. Organizing supplies for the base and for the visiting field units is not only about figuring out what will be needed for the next 12 months. It’s just as important to order the most suitable products for the harsh yet sensitive environment at the base. “WHILE VISITING THE BASE, it’s the quietness and the pristine environment – still undamaged by human interference, that always makes the deepest impact on me,” Nottage says. Part of his job is to make sure it stays that way, he adds. “We are constantly working to minimize our footprint in Antarctica,” he says. “Everything that goes down there has to be either consumed or brought back. Every piece of cardboard, plastic or glass, as well as human waste products or scrap metal, has to go back to Christchurch for recycling.” All freshwater used at the base is produced from 34 SCA SHAPE 42011 the seawater, and a wastewater plant makes sure that the water going back to the Southern Ocean is clean. The remaining solid cake is also shipped back for recycling. To make sure the cleaning process works smoothly, it’s important to use highly degradable products that meet the environmental requirements set up for the base, like the toilet tissue products supplied by SCA. “We have to buy two types of toilet paper,” Nottage says. “The one for the base itself has to be the softest one-ply available to make sure the sewage plant can handle it. For the field use, out on the ice or in the valley, two-ply paper is used, and all that waste is transported in containers and shipped back frozen to be disposed of at a treatment plant in New Zealand.” About 13 tons of waste is brought back annually, and Michael Nottage is keen to lower that figure, something he is discussing with SCA. The environmental concerns are passed through to every visitor, to make sure that it’s as natural to bring back every piece of rubbish to be disposed at the right place as it is to dress for an outdoor temperature at –20˚C when leaving the comfort of +20˚C inside the base. For those remaining at the base there are plenty of indoor activities, such as a movie theater, library, gym and sauna, as well as a bar with a dartboard. Outdoor activities depend on the weather, but it’s popular to borrow cross-country skis at the base and tour the southernmost ski field in the world, or go kite-skiing on the ice, or if the snow level permits, grab a push bike for a tour. FEATURE RENEWED CONTRACT Scott Base in Antarctica is a longtime user of SCA products. The contract for a hygiene solution from Tork has recently been renewed, and the base is upgrading to the next generation of dispensers and hygiene equipment. Strong product performance and strong sustainability credentials have been key factors for the partnership. Supplies being unloaded. The same ship brings back 13 tons of waste to New Zeeland annually. We use zero chlorine chemicals. We produce nearly 500 GWh of green electricity. Our wastewater is so clean that fish thrive in it. Now we are taking and are investing SEK 500m to replace two old oil-fired lime a further kilns with a single new kiln that will be run on fuel pellets from SCA BioNorr. This investment will allow us to reduce carbon emissions from fossil fuels by 80 percent! The project has been named Bio Loop 2011 and means that we can continue to increase production at Östrand pulp mill – but with a smaller and smaller environmental footprint. www.scasundsvall.com SCA ÖSTRAND MELLERSTEDT DESIGN Leaving the smallest possible footprint ECONOMY Cost-cutting programs over the past few years have made SCA a stronger company with better prospects for expansion. That was the main message at SCA's Capital Market Day. Focus on GROWTH OPPORTUNITIES TEX T: CECILIA VINELL ILLUSTRATION: ISTOCKPHOTO I N MID-SEPTEMBER, SCA held its Capital Market Day in Stockholm, an event that attracted many investors, analysts and journalists. “The company’s cost-cutting programs have made SCA a stronger company, creating better conditions for growth,” said Jan Johansson, CEO of SCA. In 2010, for example, efficiency programs generated savings of SEK 1 billion (EUR 105 million). With this reduced cost base, the company is able to increase its focus on growth to a larger extent than during the last year’s financial crisis. With 75 percent of sales in Europe, SCA needs to grow both in mature and emerging markets. Jan Johansson was pleased with the fact that SCA’s global TENA and Tork brands, which each generate more than EUR 1 billion in annual sales, both strengthened their market share in 2010, a trend that has continued during 2011.TENA is global No. 1 in incontinence care and Tork is global No. 2 in Away-From-Home tissue. Hygiene products, which account for 60 percent of sales, offer good growth potential.The global market for hygiene products amounts to SEK 675 billion and growth is driven by population growth, aging populations, increased market penetration and higher disposable income. Emerging markets account for 21 percent of sales for SCA’s hygiene businesses and they showed a sales growth of 11 percent in local currencies during the first nine months of 2011. SCA has recently made investments in a number of growth markets, such as the acquisitions of hygiene products companies in Turkey (Komili and San Saglik) and Brazil (Pro Descart). With the purchase of Pro Descart in Brazil, SCA now has operations in every Latin American country. ACCORDING TO Jan Johansson, SCA continues to expand in Southeast Asia as well, both geographically and in terms of new product categories. Ulf Söderström, president of SCA Asia Pacific, said, “More than 60 percent of future growth in the hygiene products market will come from the Asia-Pacific region.” The company is investing resources to increase its presence in the region and expand its range of products. “Innovation is incredibly important in this part of the world,” Söderström said. SCA recently opened a global innovation center in Shanghai. The center developed the TENA Belt, an incontinence care product with focus on skin comfort, which went from concept to launch in just seven months. Jan Johansson stressed the importance of innovation and sustainability as integral parts of the company’s strategy. “We have boosted the pace of new product launches in all categories,” he said. Sustainability has become a true business driver since excellence in the area not only reduces cost and risk but also improves competitiveness and strengthens the brand. SCA SHAPE 32011 37 12 HOURS with Elin Olofsson Name: Elin Olofsson Job: Timber buyer for SCA, Örnsköldsvik office, Sweden Age: 26 Lives: Umeå, Sweden Family: Partner Fredrik, who does research on fertilizing forests. Dog Igor. 38 SCA SHAPE 42011 Interests: Orienteering, hiking, all kinds of outdoor activities. Bookworm. Suggested reading? Forest of Hours, by Kerstin Ekman Hidden talent: Can recite pi to 48 digits. Third place in the 2011 Spanish Open championship in orienteering. Instead of loose -leaf binders on her of fice sh elf, axes, snowshoe Elin has s and skis for deep snow. “I rarely know what a workday will look like ahead of time”, says Elin, who likes spending most of her days outdoors. forest. lue of the ting the va measured. a im st e r ee are data fo C ollecting r and height of the tr te e m ia d e h T Elin bumps into the landowner Erik who invites her over for coffee and home made cookies. TEX T/PHOTO: ANNA GULLERS I “ T’S NOT THAT great having a moose on the roof of your car,” Elin Olofsson says. Elin, a timber buyer for SCA, is talking on the phone with a colleague while driving through the forests of northern Sweden, the forests that are Elin’s “office”. Up here, close car encounters with moose are one of the workplace risks that are less common further south. Elin is one of some 50 buyers who keep SCA well supplied with timber. Since SCA’s own forest holdings can’t provide all the wood for its industries, it buys from forests of private owners, and the number of timber buyers has increased in recent years. So far, only six of them are women, but just a few years ago there were no women doing this job. On this October morning, Elin is going to inspect a few stretches of woodland outside Örnsköldsvik. A landowner wants to harvest some of his forest, and Elin, on behalf of SCA, is a possible buyer and has to determine how much it’s worth. “Our job is to give good advice about the logging so the landowner doesn’t lose money. But at the end of the day you must accept the seller’s decision, even if his or her ideas are not optimal - forests are often a sensitive topic. A good timber buyer is perceptive and respects other people’s views,” Elin says. As a timber buyer, you also have to be pretty competitive and enjoy “Animals behave rationally. I always feel safer in the forest than in the city”. Elin Olofsson Igor, Elin’s Norrbotten spitz, loves to lounge on the rug at work. Outdoors he will quickly gulp down a forest mouse. trying to bring in the volume that’s needed for the month, Elin says. And you have to enjoy doing business. “The best thing about the job is that it’s open-ended,” she says. “I rarely know what a workday will look like ahead of time. And then you’re outdoors. Not least, the weather will affect my day. Am I afraid of bears? No, animals behave rationally. I always feel safer in the forest than in the city. People can act any odd way.” SCA SHAPE 42011 39 MARKET Packaging that gives champagne THE CHILLS A special case for Moët et Chandon champagne keeps the drink cool and can be reused. Fresh Pack is not only an example of innovative design, it’s also the result of a strictly controlled process. TEX T: KONSTANTIN C IRINA PHOTO: SCA MOËT ET CHANDON wanted a new summer case for its world-famous champagne that would be aesthetic and functional and could also offer costumers a bonus. To meet this need, the company turned to SCA Packaging Nicollet in France. The assignment was to combine the words “freshness” with “nomadism”, to emphasize carefree summertime consumption of Moët et Chandon champagne. It was also important that sustainable thinking go into the new case. The SCA team came up with the idea of an isothermal case — an insert enclosed in an exterior ecological package — to keep the champagne cool for two hours, perfect for a picnic. But designing a premium made-to-measure industrial product is challenging. “Insulation is a very exact science,” says Frédérique Sementery, the project manager at SCA “An air leak at the closure of the insert would have affected its hermetic qualities.” Every detail had to be designed precisely, right up to the fold of the insert. Even though finding a good packaging solution is a creative process, SCA’s Design Center follows determined steps to make sure the result is “design that is more than just design.” “The process at the Design Center is genuine applied research,” says JeanDavid Jacoby, international brand manager at Moët et Chandon. “When the teams from SCA propose a project to us, we know that it is feasible industrially.” PATRICE BARAUD, the development man- ager for the project at Moët et Chandon, says that this approach saves time. “We can go faster in development in order to better satisfy our customer,” he says. The case offers a sustainable element, as it can be reused in other circumstances, and improvements will be made. ”In the future, for sure, we will use a biodegradable polyester fi lm which was not possible at the time of the design of Fresh Pack,” Baraud says. Fresh Pack won the Formes de Luxe award at the luxury packaging fair Luxe Pack 2010 in Monaco. Moët et Chandon has also released festive versions of Fresh Pack for the year-end holidays. News from SCA SCA INSIDE Time to shake the LIBERO BOOTY This year’s autumn collection of Libero Up&Go Limited edition has a dance theme. The diapers are extra thin for all kids to enjoy the freedom of moving easily. As an extra feature, all Libero fans can create their own dance videos from an application on www.libero.com. Chose between four dancing babies, add the music and upload your video on Facebook. INVESTORS PAY THE FOREST A VISIT “IT'S DIFFICULT TO BE PERFECT, but we must never stop striving for it”. That is the message that Björn Lyngfelt gave to SRI (Socially Responsible Investments) investors during a visit to SCA’s forest products operations in Sundsvall, Sweden in September. The purpose of the day was to communicate SCA’s sustainability initiatives in general and the Forest Products’ operations in particular. SRI investors are growing in importance. The proportion of investors who examine SCA from a sustainability perspective is 23 percent, an increase of 18 percentage points since 2004. “This will help me answer questions about SCA in a much better way than just reading reports,” said Richard Torgerson, senior analyst, corporate governance at Folksam. MY FIRST HOUSE THIS HOUSE CAN BE YOURS without taking out an expensive mortgage. SCA has developed a strong and stable house – a children’s playhouse, actually – for the toy manufacturer iToy. The house, which weighs just 3.7 kilograms, is suitable for use indoors or outdoors. It comes unprinted so that children can paint it as colorfully as they like. “The combination of cardboard and toys sparked our play instinct,” says Torsten Biermann, product manager at SCA. SCA SHAPE 42011 41 SCA INSIDE TAMPONS with a twist JUST MONTHS after the launch, the new Libresse 72 HOURS tampons have increased their market share in Norway and Sweden. Among other advantages the new generation of Libresse tampons now come with an easy twist opening. A “72-HOUR RACE to Innovation” in September gave participants three days to come up with innovative ideas and turn them into feasible projects. The race aimed to generate new business ideas for the Ortviken papermill, and also to improve SCA Forest Products’ innovation process. The result was several completely new projects so well designed they could be put into effect right away. The 72-hour race concept was created by Kaj Mickos, and this was the first one ever held in the forestry industry. HELP TO THE HORN OF AFRICA SCA HAS DONATED feminine care products to women affected by the famine and unrest in Somalia. Some 1.6 million products have been distributed in camps where people have taken refuge after fleeing the country’s conflicts and drought. Sanitary products are very important for the health and dignity of women and girls. “Thanks to SCA’s donation, we can distribute feminine care products to 42 SCA SHAPE 42011 women who have fled to Ethiopia,” says Hans ten Feld at UNHCR, the United Nations refugee agency. “It seems obvious that SCA would help out in the extremely difficult situation that has arisen in the Horn of Africa,” says Kersti Strandqvist, senior vice president of Corporate Sustainability at SCA. “After food and water, access to hygiene products is necessary to prevent illnesses.” Somalia FEATURE SCA INSIDE 1 euro to the Red Cross for every SCA Facebook like. (The aim is to reach 5,000 new likes) DIAPERS TO FLOOD VICTIMS AFTER THE OCTOBER floods in Thailand – the worst in 50 years – SCA associates there were offered a half-day off from work to volunteer their help with packing food and products for distribution to the flood victims. SCA sent cartons of diapers to a rescue center, as a small gesture to help alleviate the distress of parents and families with young children affected by the floods. The American President Barack Obama enjoys lunch with his staff and SCA’s Tork Xpressnaps. LEGO AND TEMPO LOOKING FOR NEW COSTUMES TWO CLASSIC products are looking for a new packaging design. Tempo tissue wants a new pack design and, most importantly, a new shape for the standard Tempo tissue box. LEGO is looking for a new innovative packaging design to replace the current LEGO “Bricks & More” starter set box. This third edition of the SCA Design Challenge, launched in September 2011, is open to students and non-professional packaging designers. The winner will be announced in March 2012. For more info: www.scapackagingdesign-challenge.com SOUTH AFRICANS LOVE CUDDLERS THE DIAPER BRAND CUDDLERS has beat- en all its rivals in a large South African consumer survey and has been named “2011 Iconic Brand” in the diapers category. The Iconic Brand survey takes place each year, and 15,000 South African consumers participate. Together with the local partner Nampak Tissue, SCA produces and sells products of the Cuddlers baby care range in South Africa through the Sancella SA joint venture. SCA SHAPE 32011 43
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