Measures for biodiversity and ecosystem enhancement within LD Celulose's plantations

[ESRS E4-5; GRI 304-1, 304-2, 304-3]

The plantations managed by LD Celulose operate fully in accordance with the guidelines and high standards of Lenzing for sourcing wood and pulp. During the planning, the intense utilization of wood resources and the potential negative effects on biodiversity were part of the risk analysis. In order to avoid these potential risks, LD Celulose works with conservation programs and also follows the FSC^® standards.

In the responsible management practiced by LD Celulose, techniques are employed that aim to protect biodiversity as well as soil and water quality. Examples of these measures are:

• Minimum cultivation: For soil conservation, LD Celulose uses the minimum cultivation technique, which consists of keeping the remaining plant material at the harvest site to form layers of soil protection and ensure the cycling of nutrients.
• Nutritional recommendation: LD Celulose performs soil analyses to determine the requisite fertilizer recommendation for maintaining soil fertility.
• Habitat connectivity: To improve the connectivity of the Permanent Preservation Areas and Legal Reserves, LD Celulose carries out mosaic planting, establishing ecological corridors that aim to connect fragments of native forest. This connectivity allows animals and plants to migrate between different conservation areas, so that different populations can mate and preserve the genetic diversity. This measure is a voluntary activity beyond the legal and certification-related requirements.

Preservation and monitoring of riparian forests: These forest areas along waterways contribute to the maintenance of water quality and the quantity of water available. They retain sediments and nutrients carried by the rain, preventing water pollution and silting in bodies of water. In the Brazilian legislation, riparian forests are protected as they are considered Permanent Preservation Areas. LD Celulose defines all Permanent Preservation Areas in its forest management units and monitors these riparian forests.

Restoration and reforestation

[GRI 304-3]

Lenzing supports conservation solutions in other regions not related to its own supply chain, such as afforestation in Albania, DR Congo and the USA. Additionally, Lenzing is committed to addressing the protection of ancient and endangered forests in Canada (Broadback Forest Quebec, Vancouver Island) and Indonesia (Leuser Ecosystem) at the political level. In 2023, Lenzing signed the letter “World’s MMCF Producers Call on the Convention of Biological Diversity to support conserving at least 30 percent of the world’s forests by 2030” prepared for the COP 15 conference in the Convention of Biological Diversity (Montreal).

Lenzing has set itself the target of engaging in further conservation, biodiversity and restoration activities in regions where forests are at risk (“Conservation projects” target). To make further progress in meeting this target Lenzing in 2022 defined ways of identifying projects, to which it aims to contribute.

• Identify requirements to follow from CDP and Canopy
• Identify potential partners in the market with experience and a broad network for a successful partnership
• Identify how other players in the market are tackling the biodiversity issue

In 2023, Lenzing aligned the projects, identified, with CDP (Carbon Disclosure Project), Canopy and ÖBf (Österreichische Bundesforste/Austrian federal forests).

Innovation for people: Reducing the carbon footprint, protecting forests and improving lives of rural communities vulnerable to the effects of the climate crisis

This pilot project in the Democratic Republic of Congo, Luozi Region, combines both social and environmental components in a holistic approach to sustainably protect the environment, reduce CO₂ emissions and sustainably improve the lives of vulnerable children and families in one of the poorest countries in the world. In this research project, CO₂ is to be reduced by means of innovative products, such as agricultural waste-based charcoal and energy-saving stoves. Using this alternative charcoal reduces the need for wood harvest in the forests. In addition, income-generating activities will provide alternatives for small-scale farmers so that they no longer must produce and sell wooden charcoal. Ecological and smart integrated agricultural activities, such as combining agroforestry with beekeeping, will increase the income of smallholders, improve soil fertility and reduce deforestation. Accompanying advocacy and education measures are carried out to minimize slash-and-burn agriculture and improve forest protection.

Maintenance and support of ecosystem services in Austria

In 2023, Lenzing actively engaged in the maintenance and support of ecosystem services that are provided by forests of its wood suppliers. This was achieved through a collaboration with Österreichische Bundesforste AG (ÖBf, Austrian Federal Forests). The primary aim of the collaboration is to support the protection of moorland and peat bogs in the state of Upper Austria. Besides the peat bog restoration, the project also supports additional activities, which improve or maintain the ecosystem services provided by forests. For example, in 2023 Lenzing supported the planting of 200 bee and pollinator friendly shrubs along an approximately one kilometer long forest trail. This activity counteracts the decline of pollinators by restoring their habitats which are increasingly affected by intensive agriculture and pesticide use.

During 2023, Lenzing and ÖBf jointly outlined and prepared an action plan for the engagement on peat bog protection in the coming year.

Biodiversity around the production site in Lenzing (Austria)

Lenzing has built a photovoltaic plant on a former landfill site in the immediate vicinity of the Lenzing (Austria) site, which was finished in 2022. Currently, Lenzing is creating a biodiversity island at this site by planting a lean meadow between the photovoltaic modules. This will ensure that the area can become a habitat for local insects, birds and other animals, while at the same time delivering renewable energy to the site. Seeds for local plants were carefully selected to ensure a high diversity of wild plants for the local animal population. At the edges of the rough pastures, maintenance measures are deliberately avoided in order to create natural habitats for microorganisms and insects through dead wood, stone accumulations and foliage.

Lenzing manages a forest association of around 40 hectares around the main plant in Lenzing. The forest serves as a “green belt”, a natural barrier for site specific emissions around the Lenzing site, and offers several ecosystem services, including recreational ones for the local community. The forest area, especially in the 80-year-old stand, is a habitat for wildlife and insects. Lenzing follows a sustainable management concept that avoids clear-cutting. It favors the selective removal of individual trees and uses this local wood for its fiber production. It also disposes of the rootstocks and other waste parts through the local district heating generator. This way, Lenzing reduces emissions and keeps the raw material in the region. When reforesting, emphasis is also placed on native and diverse tree species to mitigate future challenges of climate change. Lenzing works with local partners to keep the added value in the region.

Bee protection project in Brazil

For many years, LD Celulose has been involved in an initiative to support beekeepers. The company maintains a partnership with associations of honey producers in the Triangulo Mineiro region and in rural São Paulo. LD Celulose makes part of its forests available so that beekeepers can set up their bee boxes there. The 4,000 boxes currently installed produce about 50 tons of honey per year. This partnership benefits both the environment and the local communities, as it leads to increased protection and monitoring of the forests, an increase in bee populations and higher income for the beekeepers. A new phase of the project is the implementation of a training programme for young people on how to produce honey, together with the partner associations of honey producers.

Albania

The Lenzing Group started a forest conservation project in Albania in 2019. The project will continue until the end of 2024 as planned. Additionally, the scope of the project has been significantly expanded to include neighboring countries, this expanded project will continue after 2024. It is managed by the Austrian Development NGO ICEP and is funded by ADA (Austrian Development Agency) and the Lenzing Group. The original aim was to support the development of rural areas in Albania in the broader region of Shkoder (Ana e Malit) and Diber (Peshkopi) by using natural resources sustainably and fostering alternative income sources for communities. The goal of the original scope was to implement conservation solutions covering 20 hectares in this area. The extended scope now aims to afforest 45 ha of degraded land and restore additional 75 ha in the area. To achieve this 110,000 trees will be planted.

The transboundary catchment area, which is an area of land where water collects when it rains, of the Drin River includes the countries of Albania, Kosovo, North Macedonia and Montenegro. This area consists of large forest and pasture areas, rich biodiversity ecosystems and is one of the most water-rich areas in Europe in terms of freshwater ecosystems. Over the last three decades, the forest area in the four target countries along the river basin has been heavily exploited and is under threat due to increased illegal logging activities and consequences of climate change like drought and forest fires.

The long-term impact of the project is to contribute to climate change mitigation and sustainable development along the Drin River through strengthened integrated forest management (IFM). Through the set measures, the living conditions of rural communities in the target areas will be improved. The overall outcome of the project is to increase socio-economic and environmental benefits for local communities through ecosystem services. The project applies a multi-stakeholder approach, integrating national and international experts as well as local communities, central and local authorities, and on-going initiatives.

Achievements in 2023

• 5 ha afforested
• 10,778 trees planted
• 63 local forest workers have been employed and educated in reforestation and the use of machinery
• Kick-off conference on Integrated Forest Management with 60 participants from public administration, ministries, universities, public and private forestry companies, etc.

Fiber brand-related climate protection, forest protection and afforestation projects 2023

Lenzing launched additional low-carbon TENCEL™ and VEOCEL™ branded lyocell and TENCEL™ branded modal fibers for applications in the textile and nonwoven industry. Based on the concept of reduce-engage-offset, Lenzing has focused on low carbon emissions through various reduction actions and has balanced the yet remaining carbon emissions of these fibers through carbon compensation projects. The new fibers are certified by ClimatePartner in accordance with the Greenhouse Gas Protocol, the leading global framework for measuring carbon emissions. All selected and supported climate and forest protection and afforestation projects are certified according to Gold Standard VER or Verified Carbon Standard.

For projects supported by Lenzing in 2022-2024 and their details see the following ClimatePartner ID Tracking pages:

• ClimatePartner projects/TENCEL™ branded fibers
• ClimatePartner projects/VEOCEL™ branded fibers

For 2023/24, Lenzing will continue to support and use Offset credits from a broad mix of projects such as:

• Wind energy in Thailand/West Huaybong
• Geothermal energy in China/Changdao
• Solar energy in India/UP, Karnataka & Maharashtra
• Bio gas in India/Punjab
• Afforestation in China/Anlong
• Forest protection in Brazil/Labrea

The acquired credits will be retired according to the consumptions in each year.