Sustainability is one of the essential pillars of Sonae Arauco's corporate strategy. The manufacturer is a committed supporter of the European Union's climate targets and wants to actively contribute to the sustainable transformation of the construction industry with its products, because buildings today account for more than 40 percent of energy consumption and are responsible for more than 36 percent of greenhouse gas emissions associated with energy consumption.

Wood-based products such as chipboard, fiberboard, OSB boards and wood fiber insulation materials can make a decisive contribution to reducing emissions. This is because wood has the special ability to store CO₂, which is the main cause of climate change. Thanks to this outstanding property of the material, the wood-based solutions produced by Sonae Arauco last year retain around three million tons of CO₂ during their life cycle. This is very long for the products mentioned, as they are used in structural construction, decorative interior design, and furniture production.

The amount of CO₂ retained was calculated using the Environmental Product Declarations data which is verified by an independent body . This enables a transparent Life Cycle Analysis of the products based on EN15804 and a calculation of the specific carbon retention (kg CO2-eq/m³). Sonae Arauco's entire product range, which the company sells in around 70 countries, was taken into account.

Extending the life cycle through recycling

Dr. Steffen Körner, Managing Director of Sonae Arauco Deutschland GmbH: "For people like us who work with the valuable raw material wood daily, the sustainable use of resources is a clear priority. Wood is an answer to many of the challenges of the future, as it is a renewable, recyclable raw material that enables a biocircular economy. For us, the recycling of pallets, packaging, used furniture or leftovers from construction sites and sawmill by-products is an important part of our sustainability strategy. In this way, the life cycle of the material - and thus its CO₂ binding - can be further extended. Burning wood as a heating material should only be the last step after no other material recovery or recycling is possible."

The proportion of recycled wood in some of Sonae Arauco's products is already up to 75%. In 2023, the company processed more than 725 thousand tons of recycled wood in its products and is consistently working towards a higher proportion of recycled wood. The medium-term goal is to achieve, in some geographies, 85%. As one of the leading suppliers of wood-based materials, Sonae Arauco wants to leverage the critical role of its portfolio and contribute to the decarbonization of the construction and housing value chain. The insulation of buildings will play an important role in the climate transition. Wood fiber insulation materials made from renewable raw materials are therefore an indispensable sustainable option.

Promoting sustainable forestry

In 2021, the company signed its first financing related to sustainability performance* and committed to increasing the amount of recycled wood it uses by a further 19 per cent by 2026. All its industrial operations in Europe are certified by the two leading global forest certification schemes whose mission is to promote sustainable forest management: The PEFC (Programme for the Endorsement of Forest Certification Schemes) (PEFC/14-35-00013) and FSC® (Forest Stewardship Council®) Chain of Custody (FSC® C009049). Sonae Arauco also pursues an ambitious and innovative strategy for Portuguese forests. Research and development projects are conducted, and working groups integrated to promote and ensure the transfer of knowledge regarding the management of natural material and its sustainable development.

"The future of our industry depends on our ability to exploit the territory through sustainable forest management, creating value through the industrialization of wood, exploiting the potential of the material and preserving ecosystems and ways of life", Rui Correia, CEO of Sonae Arauco.

* The performance indicators defined have been validated by Standard & Poor’s and are aligned with the Sustainability-Linked Loan Principles issued by the Loan Market Association. The operation was led by CaixaBank and also involved ABANCA, Caixa Geral de Depósitos, Export Development Canada and The Bank of Nova Scotia.