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Post-it maker 3M unveils greener paper-sourcing policy

(Adds details on supplier)

By Lewis Krauskopf

NEW YORK, March 5 (Reuters) - St. Paul-based 3M Co, one of the world's largest manufacturers and the maker of Post-it notes, will take new steps to ensure that its suppliers of paper, pulp and packaging provide materials that come from sustainably logged timber.

The new paper-sourcing policy, aimed at preventing the destruction of fragile forests, comes after pressure on 3M from environmental activists, who accused the company of outdated practices.

The company, which also manufacturers Scotch brand tape products, will now require some 5,000 direct suppliers, located in more than 70 countries, to provide data, including the source of their harvested wood fiber. The company says it may sever ties with suppliers that fail to meet its standards.

While other companies have also set conservation standards for their suppliers, 3M's action is expected to have broad ripple effects, because of the size of its supply network, said Todd Paglia, executive director at ForestEthics, a forest and climate advocacy organization.

ForestEthics, which led a campaign against 3M, is now applauding the company's new standards.

"No other manufacturer has adopted such a rigorous policy with such reach around the world," Paglia said.

3M is the latest company to take voluntary steps to reform its supply chain practices amid pressure from environmental groups. In January, Wilmar International Ltd, the world's largest palm oil processor, opened its supply chains to outside scrutiny in what environmentalists called an unprecedented step to help safeguard tropical forests.

Under 3M's policy, all paper-based products and packaging suppliers will be expected to harvest in ways that don't threaten peatland ecosystems and intact forest landscapes. The policy also aims to protect dense, high-carbon stock forests and ensure the rights of indigenous peoples.

The company said it developed its policy in collaboration with environmental groups. The company is working with a non-profit agency, The Forest Trust, to help make sure suppliers are not running afoul of conservation standards. Greenpeace has also hailed the new policy.

The company, which declined to specify how much it spends purchasing paper products, is in the process of reviewing its suppliers and says it will issue its first public progress report in May.

"We are taking responsibility for making sure our pulp and paper suppliers meet the requirements of the policy, and help them to raise their performance if necessary," said Jean Sweeney, 3M's vice president of environmental, health, safety and sustainability operations.

As a result of its new policy, 3M has entered into discussions with Canada's Resolute Forest Products Inc, which has been criticized by Greenpeace for its logging practices. Although 3M does not purchase material directly from Resolute, some companies that supply it with paper products do. Sweeney said that for now, 3M will not initiate new business that includes Resolute.

A Resolute spokesman said the company does not comment on specific customer or vendor relationships, but said that "Resolute adheres to the letter and spirit of the law, and in many cases exceeds regulatory requirements."

"We actively speak with customers and prospective customers and tout Canada's leadership and our own leadership in forestry practices and in overall sustainability matters," said Seth Kursman, Resolute's vice president of corporate communications, sustainability and government affairs.

As part of its new initiative, 3M has created positions in each of its four regions around the world to oversee implementation of the paper-sourcing policy.

The costs of implementing the policy are immaterial to earnings, according to 3M, which reported $31.8 billion in sales last year.

ForestEthics ran a multi-year campaign against 3M that included a 40-foot Post-it note hung off a bridge near 3M's headquarters. The fake "to-do list" sign included the words "destroy forests" with a checkmark next to it.

Up to now, 3M has lacked a meaningful paper buying policy, said Rolf Skar, Greenpeace's forest campaign director. Greenpeace had been working behind the scenes and was considering ramping up its campaign if 3M did not act, Skar said.

"They probably heard the footsteps of an escalating campaign, but also see sustainability as a brand asset," Skar said.

"It's a good step forward," Skar said. "The marketplace drives real change." (Reporting by Lewis Krauskopf; Editing by Peter Henderson and Sue Horton)