Material sustainability risk issues identified in 2009

The risk table is divided into two sections. Section one highlights the key impacts that we have on sustainability and on our stakeholders. Section two focuses on the sustainability trends, risks and opportunities that affect our long-term prospects and financial performance

Key impacts on sustainability and on our stakeholders

Potential risk	Mitigation measures
Fatalities, serious injury and illness Continued high inherent risk of fatality and serious injury/illness in all parts of the Group	Management commitment to ‘Zero Harm’ in the workplace, a business value with clear objectives – safety has the same priority as other business objectives Applying our safety management system provides clear guidelines for decisions to promote ‘Zero Harm’ Defining and observing safe practices and behaviours that hold a prominent place in procedures, rules and practices Ensuring performance standards that are well communicated, widely understood and part of daily life Keeping risk register of significant safety risk up to date Working within externally accredited safety management systems such as OHSAS 18001 Benchmarking our practices against recognised good international industry practice Aiming to be the safest company in our industry sector
Fire or explosion Continued high inherent risk due to volumes of combustible materials at plants and warehouses and potential for large wild fires in forestry	Safety risks are managed through clear standards, a regular review of our hazard analysis and a risk register of significant safety risks – in 2009 in our control of work and management of change were audited and reviewed In forestry, a dedicated fire safety resource and a modernisation of our fire fighting capabilities has taken place
Mechanisation of plantation forestry High inherent risk due to public perception of the change, loss of rural support and significant chronic ill-health of current contractors in South Africa	Social and environmental risks and challenges are addressed and mitigated on area level on a case by case base The Food 4 Forests programme provides balanced, nutritious meals for forestry workers with the aim to reduce absenteeism and injuries due to lack of concentration and physical endurance, and improve quality of life The Mondi Mkhondo Development Programme offers people access to economic opportunities and social services
Public health claims in South Africa Moderate inherent risk owing to perceived health effects in surrounding communities	All Mondi operations comply with local emissions regulations The first phase of the odour reduction project in Richards Bay is expected to be completed in surrounding communities 2010
Environmental impact from loss of containment Moderate inherent risk for pulp manufacturing and previous landfill activities	Ongoing programme of assessments of past disposal activities

Sustainability trends, risks and opportunities

Potential risk	Mitigation measures
Loss of access to credible fibre associated with unsustainable forestry practices High inherent risk owing to external scrutiny of planted forests and the harvesting of natural forests	Sustainable forestry management practices Third-party certification to FSC™ standards (or equivalent international credible certification system) of forestry activities Application of FSC™’s Controlled Wood Standard to ensure wood, fibre and biomass is not purchased from controversial sources Chain-of-custody certifications for operations Participation in international forestry dialogues to stay abreast with internationally recognised best forestry practices
Climate change footprint Continued moderate inherent risk as fossil fuel emissions reducing at a slower pace	Deliver specific green house gas reduction goal of 15% over 10 years against 2004 baseline Participate in annual carbon disclosure projects (CDP) with the aim of benchmarking Evaluate opportunities to increase share of biomass in on-site energy generation (2009: 53%) Establish product carbon footprints (using a scientifically acceptable method)
Land claims in South Africa Continued moderate inherent risk for loss of fibre supply	Mondi has developed an innovative win-win model and is working constructively with risk for loss of fibre supply Government and communities to develop claimant communities into sustainable forestry enterprises, thereby ensuring continued fibre supply

Last change: 09.02.2011