CanopyStyle Audit Report - Eastman · Chain of Custody-certified clients benefit from our over 15...

CanopyStyle Audit Reportfor Eastman Chemical

Assessment 2019

Evaluation date: 4 October 2019

Report finalization date: 6 April 2020

Organisation Contact

Ruth Farrell100 N. Eastman RoadKingsport, TN 37662Phone (347) 267 - 6946

Audit managed by

United States Regional Office13 Jolina Court-2nd FloorP.O. Box 99Richmond, VT 05477Tel: 802-434-3420Fax: 802-434-3116

2 CanopyStyle Audit Report October 2019

TABLE of CONTENTS

INTRODUCTION _______________________________________________________ 3

1. GENERAL DESCRIPTION ___________________________________________ 4

2. EVALUATION SCOPE ______________________________________________ 5

3. EVALUATION PROCESS ____________________________________________ 5

4. EVALUATION RESULT _____________________________________________ 6

Appendix A: STANDARD CHECKLIST (CanopyStyle Verification Framework – CorporateSourcing) ___________________________________________________________ 12

Appendix B: STANDARD CHECKLIST (CanopyStyle Verification Framework – MMCF MillChecklist) ___________________________________________________________ 32

Appendix C: RECOMMENDATIONS FOR IMPROVEMENT ________________________ 39


INTRODUCTION

NEPCon is an international, non-profit organisation that delivers sustainability services andengages in innovation projects to facilitate the transformation of business practices andconsumer behaviour to promote the responsible use of natural resources. Around 1,300Chain of Custody-certified clients benefit from our over 15 years of experience in providingservices to the forest supply chain sectors – including timber processing and manufacturingcompanies, printing houses, publishers, paper merchants, traders and retailers of all sizes.Through a well-developed network of regional representatives and contractors, NEPConoffers timely and cost-effective certification services around the world.

The purpose of this report is to document performance of Eastman Chemical hereafterreferred to as ”Organization”, against the requirements of the Verification Framework andGuidelines, (February 2019 version1 ) and further guidance documents2 developed byCanopy and approved, supported and requested by the CanopyStyle Leaders for ForestConservation (Leaders Group)3 and the over 200 brands, retailers and designers lookingto implement their sourcing policies for man-made cellulosic textiles. The focus of thisverification audit is to manage the risk and avoid sourcing from ancient and endangeredforests and other controversial sources and implement other sustainable sourcingmeasures, across the supply chain from the point of wood harvesting in forests and/orplantations and through to the brand and retail customers. Man-made cellulosic fibre(MMCF) producers, are required to document and provide evidence towards a set of pre-defined social and environmental criteria and key progress indicators as part of theCanopyStyle initiative.

The audit presents the findings of NEPCon auditors who have evaluated company systemsand performance against the applicable standard(s). The public version excludesconfidential and sensitive information that did not does not affect the formal results of theaudit. Section 4 below provides the evaluation conclusions. The auditor reviewed andused Canopy’s map of ancient and endangered forests, which has been overlaid with thesourcing regions and list of suppliers of the company to assess the level of risk.Dispute resolution: If NEPCon clients encounter organisations or individuals havingconcerns or comments about NEPCon services, these parties are strongly encouraged tocontact the relevant NEPCon regional office or any member of the NEPCon Chain of CustodyProgramme. Formal complaints and concerns should be sent in writing.

1 https://canopyplanet.org/wp-content/uploads/2019/04/CanopyStyle-Audit-Guidelines-and-Framework-2019-version.pdf2 https://canopyplanet.org/resources/canopystyleaudit/canopystyle-audit-guidelines/3Current members of this group are H&M, M&S, Inditex/Zara, EILEEN FISHER, Stella McCartney and Canopy


1. GENERAL DESCRIPTION

1.1 Organization overview

The organization receives and uses dissolving pulp to produce cellulose acetate filamentyarn and staple fiber. The organization uses three suppliers of dissolving pulp, twosuppliers are FSC certified and sell pulp with an FSC Mix Credit or FSC Controlled Woodclaim. The remaining supplier is PEFC certified and sells pulp with a 100% PEFC certifiedclaim. The PEFC certified supplier sources pulp from a plantation in Brazil. The organizationhas FSC Controlled Wood in scope of their FSC certification to cover sourcing from thissupplier.

1.2 Organization scope (sites, locations, etc)

The organization has one site in Kingsport Tennessee, USA.

1.3 Organization sourcing policy

The organization’s sourcing policies can be found on the following websites:

https://naia.eastman.com/sustainabilityhttps://naia.eastman.com/woodpulpsourcinghttps://naia.eastman.com/woodpulppolicy

A general overview is pine and eucalyptus dissolving grade wood pulp has been sourcedfrom Bracell, Georgia-Pacific Cellulose and Rayonier.


2. EVALUATION SCOPE

3. EVALUATION PROCESS

Auditor name(s) Qualifications

Jenna Mueller Jenna Mueller started with the Rainforest Alliance in August of2013, completed training to be an approved Staff Auditor inSeptember 2013, and has completed 100+ FSC audits. Prior tojoining the Rainforest Alliance, she spent 1.5 years as anenvironmental and sustainability auditor and consultant. Inaddition, Jenna has more than 8 years of experience as abiologist and manager. Jenna became part of NEPCon inOctober 2018.

2.2 Audit Overview

Scope Item Check all that apply to the Certificate Scope

Mill Type: Single Multi-site

Input Material Source: Listed in supplier CoC form Other suppliers

Majority Fiber Input: Dissolving pulp

Map of Ancient andEndangered Forests OverlayCompleted:

Yes No

Comments:

Mill Capacity: 200,000 KMT/year

Primary Activity:

Outsourcing: FSC-certified subcontractors Non-certifiedsubcontractors

Outsourcing of the complete production process

High risk subcontractor site(s) included

No outsourcing

Workforce: 14,644 Permanent male: 11,130 Permanent female:3,514

Contract male: Contract female:

TOTAL: 14,644

Sites included in evaluation Location

Eastman Chemical 200 S Wilcox DR, Kingsport, Tennessee

Site(s) Audit date Total on-site audit time(Hours)


2.3 Description of Overall Audit ProcessThe auditor had a preliminary meeting to discuss the Canopy audit process and scope ofthe work on 16 August 2019.

The onsite evaluation was started at 8:00 a.m. on Friday October 4. The auditorobserved receiving and warehouse storage locations, in addition to a discussion andgeneral tour of environmental protection systems such as the above ground wastewaterprocessing facility.

Persons interviewed are listed in Appendix A.Documents reviewed included:Emails between Canopy and the organization concerning advocacyPowerPoint presentations concerning- research and development, advocacy, foundationwork, and sustainabilityWebsites such as sustainability, suppliers, sourcing (specifics listed in report)FSC Controlled Wood Risk Assessment for Bracell, Rayonier, and Georgia-Pacific CelluloseFSC COC audit report for Eastman ChemicalAcademic Risk Assessment for Bracell and RayonierVolume SummariesSupplier ListSupplier AgreementsProceduresEvaluation of internal filing system and documents such as training topics, managementsupport, and information concerning sustainability, ethics, and values.

4. EVALUATION RESULT

4.1 Evaluation Conclusion

Overall, the organization had very thorough tracking systems, well documentedinformation and a plethora of information available to evaluate the indicators of thisstandard. The organization is doing advanced work in recycling and creating closed loopcradle to grave fibres. Already in existence is closed loop chemical usage.

Areas of improvement include ensuring all suppliers have signed the Supplier Agreementand to address issues raised in Canopy’s Dissolving Pulp Mill Classification related toBracell’s risk due to ownership association. Bracell is owned by the RGE family of companieswhich has been linked to controversial sourcing.

Updated Conclusion: After the audit, but prior to the finalization of the report, Eastmansubmitted a signed supplier agreement with RYAM (9 January 2020) which completed the

Eastman Chemical 4 October 2019 8


signatures of agreements from all suppliers. Eastman also shared meeting invites andnotes from meetings held with both APRIL and Bracell (November 2019) that demonstratesprogress in engaging with the companies managed by Royal Golden Eagle. Eastmanrepresentatives also provided evidence of a site visit in February 2020 to Bracell, in Brazil.

4.2 Summary of findings

Rating ColorNot Applicable

Commitment Met

Commitment in Progress

Commitment Not Met

Insufficient Information Available

Key Commitment Performance Indicators Rating1. The MMCF producer has publiclycommunicated and isimplementing the FiberSourcing/Forest Policy

1.1 Senior executive and key managers make apublically available commitment to fullimplementation of the forest sourcing policy **

CommitmentMet

1.2 The MMCF producer has developed standardoperating procedures (SOP) required to implementthe Policy with input from and agreement of civilsociety stakeholders. **

CommitmentMet

1.3 The MMCF producer has assigned personnel withresponsibility for Policy implementation. **

CommitmentMet

1.4 The MMCF producer has developed capacity andorganizational structure to implement the Policy.

CommitmentMet

1.5 The MMCF producer has communicated itscommitment to implement its Policy to all itssuppliers. **

CommitmentMet

1.6 The MMCF producer has included requirements toimplement the Policy in agreements/contracts withcurrent and future suppliers. **

Commitmentin Progress

1.7 The MMCF producer has developed, and isimplementing a system to monitor supplierconformance with the Policy. **

CommitmentMet

1.8 The MMCF producer has put in place atransparent/public grievance procedure with theinput and agreement of civil society stakeholders

CommitmentMet

1.9 The MMCF producer has developed, and isimplementing, an action plan that address anyidentified non-conformance and grievance received.**

NotApplicable

1.10 Key managers at each production site are awareof the Policy and demonstrate a similar commitmentto implement it. **

CommitmentMet


1.11 Each production site managers have developedprocedures to implement the Policy, when relevant.**

CommitmentMet

2. The MMCF producer onlysources raw material fromsuppliers that are transparent,traceable and are in conformancewith the policy

2.1 An assessment of the MMCF producer supplychain has been completed globally and shared withLeaders Group. This assessment will be updatedevery year and shared with the Leaders Group. **

CommitmentMet

2.2 The assessment identifies all suppliers in the chainthat supply the MMCF mills, beginning at the forest orplantation of origin.

CommitmentMet

2.3 A risk assessment has been done with theinformation and shared with Leaders Group.

Commitment inProgress

2.4 This supply chain assessment has been presentedto the Leaders Group and stakeholders, allowing forquestions to be answered and information gaps to behighlighted.


2.5 The MMCF producer publishes its supplierspublicly, or, in the absence of such transparency, isproviding its customers with a robust track and tracesystem that can be used throughout the supply chainup to clothing and textile retailers.

CommitmentMet

3. No conversion of natural forestto plantations

3.1 The initial date of the plantation development hasbeen documented and sourcing only occurs in areasidentified pre 1994, or post 1994 with a supportingvalid FSC certificate. **


4. Since the signature of thePolicy, all sourcing from ancientand endangered forests and othercontroversial sources have beeneliminated

4.1 The MMCF producer has adopted clear definitionsfor the terms included in their Policy, such as“ancient & endangered forests”, “intact forest”,“natural forest”, “endangered species”, “controversialsources”, “high conservation value”, “high carbonarea”, “peatlands”, etc. that are consistent with thisdocument and the forest sourcing policy template. **

CommitmentMet

4.2 All areas meeting the definition of “ancient andendangered forests” have been identified andmapped and suppliers and fibre that have a high riskof being considered controversial sources have beenidentified and shared with Leaders Group. **


4.3 Any raw materials in the MMCF producer’s supplychain originating from ancient and endangeredforests or other controversial sources, and acquiredbefore the Policy was adopted by the company, suchas stocks in log yards, will be documented, identifiedaccordingly and utilised by the mills. **

Not Applicable

4.4 The MMCF producer is aware of all relevant local,national and international laws and there is noevidence of non-compliance, with local, national orinternational laws. **

CommitmentMet

4.5 The commitment not to source from ancient andendangered forests and other controversial sources isverified. **


5. If suppliers contravene thesecriteria, the MMCF producer willfirst engage them to changepractices and then re-evaluate itsrelationship with them

5.1 All MMCF producers’ suppliers are identified andthe forest of origin is known. **

CommitmentMet

5.2 The MMCF producer has developed procedures forengaging with suppliers, up to withdrawing frompurchase and other agreements in situations wherenon-conformance is found. **(Note: This means potential legal and contractualissues associated with withdrawal are identified andaddressed.)

CommitmentMet


5.3 The MMCF producer has documented withdrawalsfrom supply agreements where non-conformance hasbeen found. **

Not Applicable

6. The MMCF producer welcomesinterested stakeholders andLeaders Group observers to verifythe implementation.

6.1 Leaders Group and other stakeholder observersare invited to participate freely and to reportobservations during this verification process. **

CommitmentMet

6.2 Large scale scientifically based conservationplanning, High Conservation Value assessments,and/or High Carbon Value assessment, identifyingareas for protection, has been completed, based onbest available science, by a credible third party, andmade public. **

6.3 If sourcing from controversial areas, with recordsof conflict and human rights violation, an assessmentthat includes participatory mapping of lands owned orclaimed by indigenous and local communities,identification of areas for protection, areas for conflictresolution and remedy of past harms that involveaffected parties, their chosen advisors and relevantstakeholders, have been completed by a credible andmutually agreed third party and made public. **

6.4 The MMCF producer has developed amanagement plan that identifies measures to protectareas identified in large scale scientifically basedconservation planning, HCV and HCS assessmentswith the Free, Prior and Informed Consent ofindigenous and local communities whose land or landclaims are impacted and with input from credibleENGOs. **

6.5 The MMCF producer has developed andimplemented a time-bound action plan to activelyseek the legal protection of these areas with finalland-use decision-makers in a way that meetsprinciples of Free Prior and Informed Consent. **

7. The MMCF producer shallrecognize, respect and upholdhuman rights and the rights ofcommunities and workers affectedby the operations of their supplychain and affiliated companies

7.1 The MMCF producer has developed and requiresits suppliers to adopt a similar policy, systems andprocedures to implement Free, Prior and InformedConsent of indigenous people and local communities.**


7.2 Suppliers document how they conform with theMMCF producer’s commitment to recognize andrespect human rights, community rights, FirstNations rights and rights of workers. **


7.3 The MMCF producer and its suppliers showresponsible handling of complaints and resolution ofconflicts in a transparent and accountable mannerthat is mutually agreed by the parties and includesrelevant stakeholders.

CommitmentMet

7.4 The MMCF producer and its suppliers havedeveloped internal capacity and organizationalstructure to recognize and respect the rights of itsworkers


7.5 The MMCF producer has developed procedures toensure its Tier one suppliers uphold the InternationalLabour Organization (ILO) Declaration onFundamental Principles and Rights at Work and willrequire the equivalent of their own suppliers.

CommitmentMet

7.6 Recognition and respect for human rights isdemonstrated. There is no evidence of avoiding orfailing to resolve social conflicts and remedy past orcurrent human rights violations. **

CommitmentMet


8. Development of Innovative andAlternative Fiber

8.1 The MMCF producer has developed andimplemented an internal action plan to collaboratewith innovative companies and suppliers to exploreand encourage the development of new alternativefiber sources that reduce environmental and socialimpacts, such as agricultural residues and recycledfibers. **

CommitmentMet

8.2 The research and development phase for theproduction of pulp and cellulosic fiber made fromalternative fiber sources has been successfullycompleted and the MMCF producer is entering acommercial scale phase.

CommitmentNot Met

9. Voluntary advocacy forconservation solutions

9.1 The MMCF producer has a track record ofparticipating in events that support collaborative andvisionary system solutions that aim protect remainingancient and endangered forests. **

CommitmentMet

9.2 When prompted, the MMCF producer uses itsbrand influence or purchasing influence to positivelyimpact conservation and development solutions thathave the Free, Prior and Informed Consent ofaffected indigenous and local communities. **

CommitmentMet

9.3 The MMCF producer publicly supports science-based international and national target(s) andprograms for preserving designated protected andconservation areas that have the Free, Prior andInformed Consent of affected indigenous and localcommunities.


9.4 The MMCF producer is developing andimplementing specific programs to increase theendangered species population and the maintenanceof their habitat through time, with governmentand/or ENGO programs. **

Not Applicable

10. Responsible forestmanagement

10.1 The MMCF producer has defined criteria forresponsible forest management, gives a preferencefor FSC certification and has developed andimplemented an action plan to increase FSC intake.**


11. Reduction of Greenhouse Gas(GHG) Footprint by recognizingthe importance of forests andpeatlands as carbon storehouses

11.1 The MMCF producer has developed andimplemented procedures to evaluate their suppliers’performance in reducing GHG.

CommitmentMet

11.2 The MMCF producer can document givingpreference to suppliers that have identified andadopted management measures to protect forestedpeatland at the concession and landscape level (peatdome) and that have identified, withdrawn from andrestored peatlands and their hydrology. **

CommitmentMet

12. Pollution Prevention 12.1 * This verification process will not address thepulp and viscose manufacturing process which canlead to air and water emissions that impact overallenvironmental quality.

However, it will be noted when MMCF producersinvest in and use the cleanest dissolving pulp andviscose manufacturing technology(i.e. lyocell process). The indicators will be thenumber of mills using such cleaner processes and the% of overall volumes produced with such technology.This information will be treated and framed asadditional bonus performance by the MMCF producer.

CommitmentMet

4.3 Volume Summaries


Category Explanation % OverallFSC Controlled Wood Material received with an FSC Controlled Wood claim

(either from an FM or COC certified company)55-70%

Controlled material Noncertified material controlled by the company'sFSC Due Diligence System

0

FSC Mix Material received with an FSC Mix Credit or FSCMix % claim from an FSC CoC certified company

<5%

FSC 100% Material received with an FSC 100% claim from anFSC certified company (FM or COC).

0

Non-FSC Material received with no FSC claim. 0

PEFC Material received with an PEFC claim. Note materialscan be received with both a PEFC and FSC claim (nodouble counting)

20-30%


Appendix A: STANDARD CHECKLIST (CanopyStyleVerification Framework – Corporate Sourcing)

1. Evaluation of Site: Eastman ChemicalPrimary Responsible Person:(Responsible for control systemat site(s))

Paul Hammes: Quality Systems Manager, Global Quality

Auditor(s): Jenna Mueller, NEPCon Supply Chain Specialist

People Interviewed, Titles: Natalia Allen: Sustainability Leader, TextilesPaul Hammes: Quality Systems Manager, Global QualityLacey Johnson: Manufacturing TechnologistBen Holmes: Product ManagerHenrique Britto: Sourcing ManagerOpening / ClosingJon Woods: General Manager, Textiles/NonwovensBrian Eiselstein: Quality ManagerSteve Crawford: Senior VP and CTO SituationalDawn Allen: Director, Product ManagementKevin Urman: Technology Manager, Textiles/NonwovensCathy Combs: Director, SustainabilityKaren Parsons: Sr. Marketing Communications ManagerElyse Batista: Marketing Communications, Fibers

Crystal Anderson: Operator Crew 3Chad Britain: Operator Crew 3Shong Hall: Operator Crew 3Jared Tatum: Chemical Engineer, Receipt and storage ofpulp

2. Standard Checklist

1. The MMCF producer has publicly communicated and is implementing their FiberSourcing/Forest Policy

Indicators Findings

1.1 Senior executive and key managers make apublicly available commitment to fullimplementation of the forest sourcing policy.**

Conformance with Indicator:

Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:The organization has established and made publicthe policy; key managers of the organization areaware of the policy and demonstrated thecommitment to implement the policy.


A public sourcing policy is available athttps://naia.eastman.com/woodpulppolicyThe auditor confirmed through interview of stafflisted, document review, review of publicpresentations, and review of public quotes fromkey managers. As part of the commitmentstatement, a preference for FSC certified materialwas included. Agreements are used with allsuppliers and have been signed by all except one,which is currently in negotiations and plannedsigning is in the fourth quarter of 2019.

1.2 The MMCF producer has developedstandard operating procedures (SOP) requiredto implement the Policy with input from andagreement of civil society stakeholders.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:The organization is Forest Stewardship Council(FSC) certified and as such has an SOP toimplement procedures such as complaintsprocedure which includes public participation.Also, as part of FSC certification sourcing ofcontrolled material (material without an FSCclaim), stakeholder notifications, and complaintsprocedures are publicly available atwww.info.fsc.org. Additionally, supplieragreements are in place for two suppliers and arein the process of being approved for the thirdsupplier.

1.3 The MMCF producer has assigned personnelwith responsibility for Policy implementation.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization has a coreteam designated to implement this policy. A teamleader has been designated and works closely withthose identified on the core team, asdemonstrated during the site visit, interview withcore team, and reinforced by senior sitemanagement. The auditor reviewed trainingdocuments of staff for SOPs concerning FSC andCanopy.

1.4 The MMCF producer has developed capacityand organizational structure to implement thePolicy.


Not Applicable

Commitment Met


Commitment Not Met



Description of the finding: Organization has a coreteam designated to implement this policy (seenames on agenda). The team crosses businesssectors, sustainability initiatives (such as FSC),and includes members of key management at theKingsport location. Training had been conductedwith relevant staff, per review of training records.

1.5 The MMCF producer has communicated itscommitment to implement its Policy to all itssuppliers.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization hasthree suppliers of dissolving pulp, two are FSCcertified and one that sources from Brazil is onlyPEFC certified. The supplier sourcing from Brazilwas included in the organization’s FSC RiskAssessment for controlled material. Two of thethree suppliers have signed supplier agreementswhere the commitment to implement its policywas identified and agreed to. The remainingsupplier has been in negotiations to sign forseveral months and signing is expected in Quarter4 of 2019, confirmed via interview and email.

1.6 The MMCF producer has includedrequirements to implement the Policy inagreements/contracts with current and futuresuppliers.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:Written into the supplier agreements is the clausethat all suppliers must sign. Organizationdiscussed not sourcing from the one supplier thathas not signed the agreement, until it is signed.This indicator is being graded as in-progress dueto the one supplier that has not yet agreed tothe policy within contracts.

Updated Finding:After the audit, but prior to the finalization of thereport, Eastman submitted a signed supplieragreement with RYAM (9 January 2020) whichcompleted the signatures of agreements from allsuppliers.

1.7 The MMCF producer has developed, and isimplementing a system to monitor supplierconformance with the Policy.**


Not Applicable

Commitment Met


Commitment Not Met



Description of the finding:Organization had procedure to monitor supplierperformance, see GP-WI-212 in exhibit file.Annual internal audits and supplier visits areconducted by the organization’s FSC CertifyingBody of the supplier in Brazil. The other twosuppliers provide material with an FSC claim(either FSC Mix Credit or FSC Controlled Wood),both are subject to annual audits by their FSCCertifying Bodies.

Updated Finding:After the audit, the organization conducted theirfirst review using the new GP-WT-212. Theauditor reviewed evidence of this review andcontent related to the CanopyStyle audit andcommitments. (Review conducted 30 Jan 2020)

1.8 The MMCF producer has put in place atransparent/public grievance procedure withthe input and agreement of civil societystakeholders.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization isForest Stewardship Council (FSC) certified and assuch has an SOP to implement procedures such ascomplaints procedure which includes publicparticipation. See FSC procedures and riskassessment in exhibit file. Also, as part of FSCcertification sourcing of controlled material(material without an FSC claim), stakeholdernotifications, and complaints procedures arepublicly available at www.info.fsc.org.Organization traced the complaints processthrough organization for the auditor depending onhow and where a complaint would be initiatedsuch as through website or a phone call or ifoutside scope of FSC.

1.9 The MMCF producer has developed, and isimplementing, an action plan that address anyidentified non-conformance and grievancereceived.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:Organization has procedure to monitor supplierperformance. No grievances have been receivedand no non-conformances identified to date. Anaction plan has not been developed as this is thefirst Canopy audit.

1.10 Key managers at each production site areaware of the Policy and demonstrate a similarcommitment to implement it.**


Not Applicable


Commitment Met


Commitment Not Met


Description of the finding:

There is only one site. Auditor confirmedcommitment with core team, as demonstratedduring the site visit, interview with core team, andreinforced by senior site management. Theauditor reviewed training documents of staffoutside core team for SOPs concerning FSC andCanopy.

1.11 Each production site manager hasdeveloped procedures to implement the Policy,when relevant.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:Eastman has one production site that ismanaged by the corporate procedures for theCanopyStyle audit.

Summary: Organization has procedures and strong commitment to implement forestsourcing policy. All suppliers have been provided a supplier agreement explaining theforest sourcing policy and requiring a commitment to follow it. Two of the three suppliershave signed it. The third supplier has been in negotiations for several months to sign it.

Update: The final supplier, RYAM, signed the supplier agreement on 9 January 2020.

2. The MMCF producer only sources raw material from suppliers that are transparent,traceable and are in conformance with the policy

Indicators Findings

2.1 An assessment of the MMCF producersupply chain has been completed globally andshared with Leaders Group. This assessmentwill be updated every year and shared with theLeaders Group.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:Eastman’s list of suppliers is available publicly.The results of the Canopy audit will be assessedin the “hot button issues’ report and a copy of theaudit provided to the Leaders group, as confirmedthrough interview and email. The risk assessmenthas been shared with Canopy but permission hasnot been granted to share with the Leaders Group.


Updated finding: After the audit and prior toreport finalization, Eastman has grantedpermission to share with the Leaders Group(verified via interviews). Canopy accepts thispermission as commitment met.

2.2 The assessment identifies all suppliers inthe chain beginning at the forest or plantationof origin, that supply the MMCF mills.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:The organization provided the auditor with asourcing information form and supplierdocuments that identified suppliers, if sourcedfrom forests or plantations, FSC certifications,and amount of material. Suppliers are listedpublicly athttps://naia.eastman.com/woodpulpsourcingAdditionally, the FSC Controlled Wood RiskAssessment for Bracell is publicly available andother FSC suppliers (Rayonier and GeorgiaPacific Cellulose) have public FSC ControlledWood Risk Assessments. The FSC ControlledWood public summaries contain information onsupply area. Additionally, all suppliers have beenprovided a supplier agreement explaining theforest sourcing policy and requiring acommitment to follow it. Two of the threesuppliers have signed it. The third supplier hasbeen in negotiations for several months to signit.

2.3 A risk assessment has been done with theinformation and shared with Leaders Group.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization receivednames of the Leaders Group during the audit. TheOrganization hired academics at a regionaluniversity to evaluate risk of sourcing from twocurrent suppliers. The risk assessment has not yetbeen provided to Canopy nor the leaders group.

The academic risk assessment conducted includesthe assessment of three suppliers, two of whichthe company is currently sourcing from (Bracelland Rayonier) and one potential supplier. Forquality reasons, the potential supplier wasremoved from consideration. GP Cellulose(current supplier, but not a part of the academicrisk assessment) is covered by an ExecutedSupplier Agreement and the organization is onlypurchasing FSC certified material from them. GP


Cellulose has an FSC risk assessment that ispublicly available at info.fsc.org.

The company has determined that all currentsuppliers are low risk (using FSC terminology).However, in two cases, the results are notconsistent with Canopy’s Classification ofDissolving Pulp Mills, which indicates potentialrisks for two suppliers: Bracell (Management byRGE family of companies linked to deforestationand social conflict) and Rayonier(conversion/deforestation).

Because Eastman has received a minimum of FSCControlled Wood claims from Rayonier, the riskraised by Canopy can be considered mitigated.

Updated findings: After the audit, but prior tofinalization of the report, Eastman shared meetinginvites and notes from meetings held with bothAPRIL and Bracell (November 2019) thatdemonstrates progress in engaging with thecompanies affiliated with Royal Golden Eagle.Eastman representatives also provided evidenceof a site visit in February 2020 to Bracell in Brazil.

In addition, Eastman has granted permission toshare risk assessments conducted with theLeaders Group (verified via interviews).

This indicator is being graded as in progress asengagement with Bracell has just begun.

2.4 This supply chain assessment has beenpresented to the Leaders Group andstakeholders, allowing for questions to beanswered and information gaps to behighlighted.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The FSC ControlledWood Risk Assessment for Bracell is publiclyavailable and other FSC suppliers (Rayonier andGeorgia Pacific Cellulose) As part of FSCControlled Wood requirements stakeholdernotifications are required for areas of specifiedrisk. Results of stakeholder notifications areavailable at info.fsc.org.Results of the company’s academic riskassessment are confidential, the organizationrecently received names of Leaders Group and hascommunicated plans and permission to share therelevant reports, however this has not been doneto date.

2.5 The MMCF producer publishes its supplierspublicly, or, in the absence of suchtransparency, is providing its customers with arobust track and trace system that can be used


Not Applicable

Commitment Met


throughout the supply chain up to clothing andtextiles retailers.


Commitment Not Met


Description of the finding: Suppliers are listedpublicly athttps://naia.eastman.com/woodpulpsourcingAdditionally, the FSC Controlled Wood RiskAssessment for Bracell is publicly available andother FSC suppliers (Rayonier and Georgia PacificCellulose) have public FSC Controlled Wood RiskAssessments at info.fsc.org.

Summary:The company currently sources from three suppliers.

The organization conducted an academic risk assessment of two current suppliers (Bracell andRayonier) and one potential supplier for risks to Ancient and Endangered forests. Both of the currentsuppliers along with a third current supplier GP Cellulose all have FSC Controlled Wood RiskAssessments in place that are publicly available via info.fsc.org. Additionally, Eastman has includedmaterials being sourced from Bracell in their own FSC risk assessment program.The company has determined, within its risk assessment, all supply as low risk. However, for somesuppliers, this result is not consistent with the Dissolving Pulp Classification Tool, which indicatespotential risk for two of the suppliers (Rayonier and Bracell).

At the time of the audit the organization was in process of providing the third-party academic riskassessments they commissioned to Canopy and the Leaders Group, but had not yet completed thisactivity.

Update: After the audit and before the finalization of this report, Eastman has granted Canopypermission to share risk assessments with the Leaders Group and has engaged with Bracellregarding the issues raised in Canopy’s Dissolving Pulp Classification Tool.

3. No conversion of natural forest to plantations

Indicators Findings

3.1 The initial date of the plantationdevelopment has been documented andsourcing only occurs in areas identified pre1994, or post 1994 with a supporting FSCcertificate.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: All suppliers sourcingfrom plantations are FSC CoC certified, except forBracell, which is PEFC CoC certified. Bracell iscovered under the organization’s FSC ControlledWood Risk Assessment.

FSC Forest Management certification providesassurance that plantations have not beenestablished post 1994, but FSC Controlled Woodand PEFC certification do not. As Eastman issourcing a mix of all three, this indicator is beinggraded as in progress.


Summary: FSC Forest Management certification provides assurance that plantations have not been establishedpost 1994, but FSC Controlled Wood and PEFC certification do not. As Eastman is sourcing a mix ofall three, this indicator is being graded as in progress.

4. Since the signature of the Policy, all sourcing from ancient and endangered forests andother controversial sources have been eliminated

Indicators Findings

4.1 The MMCF producer has adopted cleardefinitions for the terms included in their Policy,such as “ancient & endangered forests,” “intactforest,” “natural forest,” “endangered species,”“controversial sources,” “high conservationvalue,” “high carbon area,” “peatlands,” etc.that are consistent with this document and theforest sourcing policy template.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organizationworked with Canopy to develop a public sourcingpolicy which is available athttps://naia.eastman.com/woodpulppolicy

4.2 All areas meeting the definition of “ancientand endangered forests” have been identifiedand mapped and suppliers and fibre that havea high risk of being considered controversialsources have been identified and shared withLeaders Group.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization usesa combination of FSC risk assessments (accordingto the FSC CoC CW standard for controlledmaterial) for Rayonier, GP Cellulose and Bracell aswell as an additional third-party academic riskassessment for two suppliers. The organization’sFSC risk assessment of Bracell includes annualsupplier onsite audits to review sourcing locationsand condition of the forest. The organization’s FSCCertifying Body also conducts an audit of the site.Rayonier and GP Cellulose are subjected to annualthird-party audits (by their Certifying Bodies) forFSC Controlled Wood.

Forest mapper was utilized, and areas identifiedas ancient and endangered could overlap withsome suppliers’ sourcing. The Dissolving PulpClassification Tool explains how to assess thesesources sourcing areas and providerecommendations to mitigate this risk, whichEastman is following.

Results are to be shared with Leaders Group asconfirmed through email and interview but werenot shared at the time of the audit.

Updated finding: After the audit and prior toreport finalization, Eastman has granted


permission to share with the Leaders Group(verified via interviews), but the sharing has notoccurred yet.

4.3 Any raw materials in the MMCF producer’ssupply chain originating from ancient andendangered forests or other controversialsources, and acquired before the Policy wasadopted by the company, such as stocks in logyards, will be documented, identifiedaccordingly and utilised by the mills.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization keepsless than 15 days of pulp onsite. This is notapplicable. Auditor confirmed through mill tourand review of invoices.

4.4 The MMCF producer is aware of all relevantlocal, national and international laws and thereis no evidence of non-compliance, with local,national or international laws.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Local national andinternational law are all elements of an FSCControlled Wood risk assessment. Weakenforcement is identified, Corruption PerceptionIndex is considered, and results are used toindicate low or specified risk. These elements areidentified in the organization’s FSC riskassessment. Additionally, the organization has toadhere to trade and customs laws and the LaceyAct to import material into the US, elements thatare part of FSC certification requirements. Giventhe publicly available sourcing policies, code ofconduct and based on interviews, the organizationtakes adherence to laws paramount.

4.5 The commitment not to source from ancientand endangered forests and other controversialsources is verified.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization usesa combination of FSC risk assessments (accordingto the FSC CoC CW standard for controlledmaterial) for Rayonier, GP Cellulose and Bracell aswell as an additional third-party academic riskassessment for their two suppliers. Theorganization’s FSC risk assessment of Bracellincludes annual supplier onsite audits to reviewsourcing locations and condition of the forest. Theorganization’s FSC Certifying Body also conductsan audit of the site. Rayonier and GP Cellulose aresubjected to annual third-party audits (by theirCertifying Bodies) for FSC Controlled Wood.


Forest mapper was utilized, and areas identifiedas ancient and endangered could overlap withsome suppliers’ sourcing.

The company has determined that all currentsuppliers are low risk (using FSC terminology).However, in two cases, the results are notconsistent with Canopy’s Classification ofDissolving Pulp Mills, which indicates potentialrisks for two suppliers: Bracell (Management byRGE family of companies linked to deforestationand social conflict) and Rayonier(conversion/deforestation).

Because Eastman has received a minimum of FSCControlled Wood claims from Rayonier, the riskraised by Canopy can be considered mitigated.

Updated findings: After the audit, but prior tofinalization of the report, Eastman shared meetinginvites and notes from meetings held with bothAPRIL and Bracell (November 2019) thatdemonstrates progress in engaging with thecompanies affiliated with Royal Golden Eagle.Eastman representatives also provided evidenceof a site visit in February 2020 to Bracell in Brazil.

This indicator is being graded as in progress asengagement with Bracell has just begun.

Summary: Organization is using four risk assessments to evaluate sourcing risks with theconclusion of low risk for all three active suppliers. This risk rating is not consistent withCanopy’s Dissolving Pulp Classification Tool, which identifies one with potential risk andanother with high risk due to affiliation with companies sourcing from controversialsources.

Update: After the audit, but prior to finalization of the report, Eastman shared evidence ofengagement with high risk suppliers according to Canopy recommendations. This engagement is inprocess.

5. If suppliers contravene these criteria, the MMCF producer will first engage them tochange practices and then re-evaluate its relationship with them

Indicators Findings

5.1 All MMCF producers’ suppliers are identifiedand the forest of origin is known.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization hasidentified all suppliers and identified forests oforigin, as indicated in FSC and company riskassessments and publicly available informationsuch as listing of suppliers.


5.2 The MMCF producer has developedprocedure for engaging with suppliers, up towithdrawing from purchase and otheragreements in situations where non-conformance is found.**

(Note: This means potential legal andcontractual issues associated with withdrawalare identified and addressed.)


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization usesa combination of procedures and a signed supplieragreement to engage suppliers, up to withdrawingfrom purchases and other agreements. Auditorreviewed evidence to verify the implementation ofthese producers and agreements.

5.3 The MMCF producer has documentedwithdrawals from supply agreements wherenon-conformance has been found.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: No withdrawals to date.

Summary: Organization has adequately identified sourcing locations and have proceduresto hold suppliers to agreements.

6. The MMCF producer welcomes interested stakeholders and Leaders Group observers toverify the implementation.

Indicators Findings

6.1 Leaders Group and other stakeholderobservers are invited to participate freely andto report observations during this verificationprocess.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization hasparticipated in Canopy meetings, events, andadvocacy. FSC risk assessment information ispublicly available. Organization has noted andencouraged comments publicly on sourcing policy,wood pulp supplier, and on website. Upon releaseof information to Leaders Group it will provideanother avenue for participation and comment.

6.2 Large scale scientifically based conservationplanning, High Conservation Valueassessments, and/or High Carbon Valueassessment, identifying areas for protectionhas been completed, based on best available


Not Applicable

Commitment Met



science, by a credible third party, and madepublic.**

Commitment Not Met



6.3 If sourcing from controversial areas withrecords of conflict and human rights violation,an assessment that includes participatorymapping of lands owned or claimed byindigenous and local communities,identification of areas for protection, areas forconflict resolution and remedy of past harmsthat involve affected parties, their chosenadvisors and relevant stakeholders, have beencompleted by a credible and mutually agreedthird party and made public.**


Not Applicable

Commitment Met


Commitment Not Met



6.4 The MMCF producer has developed amanagement plan that identifies and measuresto protect areas identified in large scalescientifically based conservation planning, HCVand HCS assessments with the Free, Prior andInformed Consent of indigenous and localcommunities whose land or land claims areimpacted and with input from credibleENGOs.**


Not Applicable

Commitment Met


Commitment Not Met



6.5 The MMCF producer has developed andimplemented a time-bound action plan toactively seek the legal protection of these areaswith final land-use decision-makers in a waythat meets principles of Free, Prior andInformed Consent.**


Not Applicable

Commitment Met


Commitment Not Met



Summary:The organization has participated in Canopy meetings, events, and advocacy. FSC risk assessmentinformation is publicly available. Organization has noted and encouraged comments publicly onsourcing policy, wood pulp supplier, and on website. The organization is not sourcing from ancientand endangered forests and therefore 6.2-6.5 above is not applicable.

7. The MMCF producer shall recognize, respect and uphold human rights and the rights ofcommunities and workers affected by the operations of their supply chain and affiliatedcompanies.

Indicators Findings

7.1 The MMCF producer has developed andrequires its suppliers to adopt a similar policy,systems and procedures to implement Free,Prior and Informed Consent of indigenouspeople and local communities.**


Not Applicable

Commitment Met



Commitment Not Met


Description of the finding: Organization identifiesFPIC in sourcing policy

https://naia.eastman.com/woodpulppolicy

and on supplier agreements, which must besigned.

7.2 Suppliers document how they conform withthe MMCF producer’s commitment to recognizeand respect human rights, community rights,First Nations rights and rights of workers.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization identifiesthis in their sourcing policyhttps://naia.eastman.com/woodpulppolicyf andon supplier agreements, which must be signed.However, not all suppliers have signed theagreements.

7.3 The MMCF producer and its suppliers showresponsible handling of complaints andresolution of conflicts in a transparent andaccountable manner that is mutually agreed bythe parties and includes relevant stakeholders.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization hascomplaints procedures. FSC complaintsprocedures are publicly available through the DDSsummary at info.fsc.org for each supplier. Onlyone supplier does not have FSC certification,Bracell, however, Eastman controls these inputswith mechanisms to handle complaints.Complaints can be received from website numberlisted in several places. Organization describedhow complaints would be handled depending onsource to the auditor.

7.4 The MMCF producer and its suppliers havedeveloped internal capacity and organizationalstructure to recognize and respect the rights ofits workers.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization identifiesthis business code of conduct in their sourcing


policyhttps://naia.eastman.com/woodpulppolicyand onsupplier agreements, which must be signed. Notall agreements are signed at the time of this audit.

Auditor confirmed through interview with CoreTeam and with plant workers that structures existand workers felt safe in bringing forward anyconcerns.

Updated findings: After the audit, but prior to thefinalization of the report, Eastman submitted asigned supplier agreement with RYAM (9 January2020) which completed the signatures ofagreements from all suppliers.

7.5 The MMCF producer has developedprocedures to ensure its Tier one suppliersuphold the International Labour Organization(ILO) Declaration on Fundamental Principlesand Rights at Work and will require theequivalent of their own suppliers.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization identifiesthird party code of conduct in their sourcingpolicy, which helps ensure rights at workhttps://naia.eastman.com/woodpulppolicyand onsupplier agreements, which must be signed. Allsuppliers are subjected to FSC audits and theDeclaration of Fundamental Principles and Rightsat Work are part of the Policy of Association(signed by FSC certified companies). Bracell doesnot hold FSC certification, and therefore does notsign the Policy for Association, however theirsourcing activities are subject to Eastman’s FSCControlled Wood risk assessment where thisprinciple is discussed.

7.6 Recognition and respect for human rights isdemonstrated. There is no evidence of avoidingor failing to resolve social conflicts and remedypast or current human rights violations.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization identifiesrespect for human rights in their code of conductin their sourcing policyhttps://naia.eastman.com/woodpulppolicyand onsupplier agreements, which must be signed. Allsuppliers are subjected to FSC audits and there isa human rights component of the Policy ofAssociation (signed by FSC certified companies).Bracell is subjected to an annual FSC audit wherethis principle is discussed. The auditor did not seeevidence of avoidance or failing to resolve issues,during interviews and site visit.


Summary: Organization has strong policies to recognize, respect and uphold human rightsand the rights of communities and workers. All suppliers hold certification, and supplierswithout FSC certification are included in Eastman’s FSC Controlled Wood certificationscope.

8. Development of Innovative and Alternative Fiber

Indicators Findings

8.1 The MMCF producer has developed andimplemented an internal action plan tocollaborate with innovative companies andsuppliers to explore and encourage thedevelopment of new alternative fiber sourcesthat reduce environmental and social impacts,such as agricultural residues and recycledfibers.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization’s riskassessment discusses reducing environmentaland social impacts and recommendations onsustainable fiber sourcing. Additionally, theorganization is working on closed loopmanufacturing and recycling chemicals andmaterials. See exhibit file for the presentationprovided to the auditor.

The organization is currently exploring alternativefibers, such as recycled textiles.

8.2 The research and development phase forthe production of pulp and cellulosic fiber madefrom alternative fiber sources has beensuccessfully completed and the MMCF produceris entering a commercial scale phase.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization’s riskassessment has recommendations on reducingenvironmental impacts. Due to the quality of pulprequired to produce Naia, alternative sources arenot currently available. The organization isworking towards breaking materials down to themolecular level to increase recyclabilitythroughout the life of the material. These projectsare in research and development phase.

This indicator is being graded as commitment notmet, as Eastman has not yet entered acommercial scale phase for alternative fibers theyare working on in R&D phase.

Summary: Given the quality required, organization is currently limited in its ability toconsider alternative cellulose fibers. However, organization has made recycling materialsa priority.

9. Advocacy for conservation solutions


Indicators Findings

9.1 The MMCF producer has a track record ofparticipating in events and taking actions thatsupport collaborative and visionary systemsolutions that aim to protect remaining ancientand endangered forests.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization hashistory of advocacy for environmental issues. TheEastman Foundation has given significant sums tothe Nature Conservancy and SouthernAppalachian Conservancy over multiyearpartnerships. Additionally, the organization hassupported advocacy campaigns with Canopy (seeexhibit file).

9.2 When prompted, the MMCF producer usesits brand influence or purchasing influence topositively impact conservation anddevelopment solutions including Free, Prior andInformed Consent of affected indigenous andlocal communities.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The organization hassupported advocacy campaigns with Canopy (seeexhibit file). Additionally, organization identifiesFPIC in sourcing policyhttps://naia.eastman.com/woodpulppolicyand onsupplier agreements, which must be signed.

9.3 The MMCF producer publicly supports largescale scientifically based conservationsolutions, international and national target(s)and programs for preserving designatedprotected and conservation areas including theFree, Prior and Informed Consent of affectedindigenous and local communities.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization createdFSC Risk Assessment and conducts internal auditswith supplier from Brazil. The FSC RiskAssessment. Organization commissioned ascientific risk assessment on two suppliers andone potential supplier and it did containrecommendations for sustainable fiber sourcing.Additionally, the organization has supported theNature Conservatory and other similarorganizations in their preservation of forests formany years.

9.4 The MMCF producer is developing andimplementing specific programs to increase theendangered species population and themaintenance of their habitat through time, withgovernment and/or ENGO programs.**


Not Applicable

Commitment Met


Commitment Not Met



Description of the finding: This indicator is onlyapplicable with the MMCF producer is sourcingfrom the forest directly (connected to the forest).

Summary: Organization is committed to advocacy, scientific investigation, andconservation and has several programs engaging different stakeholders.

10. Responsible forest management

Indicators Findings

10.1 The MMCF producer has defined criteria forresponsible forest management, gives apreference for FSC certification and hasdeveloped and implemented an action plan toincrease FSC intake.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization identifiesthis in their sourcing policyhttps://naia.eastman.com/woodpulppolicyand onsupplier agreements, which must be signed. Fibersourcing projections for pulp with an FSC MixCredit claim are expected in increase to three(3)times current purchases in the next year, perpresentation. This action plan has not yet beenimplemented.

Summary: Organization describes its preference for FSC certification in several locations.

11. Reduction of Greenhouse Gas (GHG) Footprint by Recognizing the importance offorests and peatlands as carbon storehouses

Indicators Findings

11.1 The MMCF producer has developed andimplemented procedures to evaluate theirsuppliers’ performance in reducing GHG.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization conducteda life cycle analysis of Naia (see exhibit file).Additionally, sustainability goals are publiclytracked on the organization’s website.https://www.eastman.com/Company/Sustainability/Goals/Pages/EnvironmentalData.aspx Supplierinput is used to create the pulp model used forNaia and is updated annually. The supplieragreement allows Eastman to request informationthat can be used to calculate the suppliers GHGemissions and tracked over time.


11.2 The MMCF producer can document givingpreference to suppliers that have identified andadopted management measures to protectforests, forested peatland at the concession andlandscape level (peat dome) and identify,withdraw from and restore peatlands and theirhydrology.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Organization identifiesthis in their sourcing policyhttps://naia.eastman.com/woodpulppolicyand onsupplier agreements, which must be signed.

Summary: Suppliers sourcing and GHG emissions affect organization’s sustainability goalsand evaluation and are monitored.

12. Pollution Prevention

Indicators Findings

12.1 This verification process will not addressthe pulp and viscose manufacturing processwhich can lead to air and water emissions thatimpact overall environmental quality. However,it will be noted when MMCF producers invest inand use the cleanest dissolving pulp andviscose manufacturing technology (i.e. lyocellprocess). The indicators will be the number ofmills using such cleaner processes and the % ofoverall volumes produced with suchtechnology. This information will be treated andframed as additional bonus performance by theMMCF producer.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Eastman implementsseveral pollution control mechanisms. Forproduction of Naia chemicals used are recycledalong with any off-spec yarn. The organization isin process of having a closed loop system forenergy needed. Much research and developmenthas been on breaking down materials to themolecular level and manufacturing in recyclability.Similarly work into being able recycle more anddifferent types of plastics into production isongoing.

Eastman provided a recent audit report (anenvironmental audit conducted by aninternational auditing body in 2019 on behalf of aglobal retail fashion brand) that confirms thatEasmain is invested in clean technology using aclosed loop process where 99% of the acetone isbeing recovered. The report also makes highremarks of their wastewater treatment plant. Theclosed loop production process and wastewaterplant applies to 100% of the Naia produced.

This indicator is being graded as met, however itis important to note that this audit does notevaluate environmental compliance or bestpractices regarding pollution prevention. This


indicator is a means to ensure that Eastman iscontinuously improving their systems to meet thestandards set by other pollution experts andverification/certification schemes.

Summary: Environmental goals such as pollution prevention are important to theorganization and information is tracked and publicly available.

** Indicates Critical Indicators


Appendix B: STANDARD CHECKLIST (CanopyStyleVerification Framework – MMCF Mill Checklist)

1. Evaluation of Site: Eastman Chemical Company

Primary Responsible Person:(Responsible for control systemat site(s))

Paul Hammes: Quality Systems Manager, Global Quality

Auditor(s): Jenna Mueller

People Interviewed, Titles: Natalia Allen: Sustainability Leader, TextilesPaul Hammes: Quality Systems Manager, Global QualityLacey Johnson: Manufacturing TechnologistBen Holmes: Product ManagerHenrique Britto: Sourcing ManagerOpening / ClosingJon Woods: General Manager, Textiles/NonwovensBrian Eiselstein: Quality ManagerSteve Crawford: Senior VP and CTO SituationalDawn Allen: Director, Product ManagementKevin Urman: Technology Manager, Textiles/NonwovensCathy Combs: Director, SustainabilityKaren Parsons: Sr. Marketing Communications ManagerElyse Batista: Marketing Communications, FibersCrystal Anderson: Operator Crew 3Chad Britain: Operator Crew 3Shong Hall: Operator Crew 3Jared Tatum: Chemical Engineer, Receipt and storage ofpulp

Brief Overview of AuditProcess for this Location:

Please refer to Section 2.3 above for Description of OverallAudit Process.

Comments:

2. Standard Checklist1. The MMCF producer has publicly communicated and is implementing their FiberSourcing/Forest Policy

Indicators Findings

1.10 Key managers at each productionsite/mill are aware of the Policy anddemonstrate a similar commitment toimplement it.**


Not Applicable

Commitment Met


Commitment Not Met



Description of the finding:The organization has established and made publicthe policy, key managers of the organization areaware of the policy and demonstrated thecommitment to implement the policy.A public sourcing policy is available athttps://naia.eastman.com/woodpulppolicyThe auditor confirmed through interview of stafflisted, document review, review of publicpresentations, and review of public quotes fromkey managers. As part of the commitmentstatement, a preference for FSC certifiedmaterial was included.

1.11 Each production site’s/mill’s managershave developed procedures to implement thePolicy, when relevant.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: There is only one site.Auditor confirmed commitment with core team, asdemonstrated during the site visit, interview withcore team, and reinforced by senior sitemanagement. The auditor reviewed trainingdocuments of staff outside core team for SOPsconcerning FSC and Canopy.

Summary: There is only one site, much of this was covered in Appendix A.

2. Sourcing from transparent supply chains that are in conformance with the policy.

Indicators Findings

2.6 The production site/mill maintains allpurchase and sales, documentation related tothe wood fiber inputs. Such documentationincludes an identification of the forest of origin.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Auditor reviewedmultiple invoices from all three suppliers.Rayonier provide dissolving pulp with an FSCControlled Wood claim and Georgia Pacificprovided dissolving pulp with an FSC Mix Creditclaim. Bracell provided dissolving pulp with a100% PEFC Certified claim. The FSC ControlledWood Risk Assessment for Bracell is publiclyavailable and other FSC suppliers (Rayonier andGeorgia Pacific Cellulose) have public FSCControlled Wood Risk Assessments, and haveshared other documents, that identify sourcinglocations. The organization’s commissionedscientific risk evaluation of the three suppliers wasprovided to the auditor and indicated sourcingareas and species. The auditor observed pulp in


the warehouse and all were from identifiedsuppliers.

2.7 The mill/production site maintains alldelivery documentation received with the woodfiber inputs. Such documentation includes anidentification of the forest of origin.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Delivery documentswere available for review and linked to invoices.All sales documents reviewed were for theidentified three suppliers listed above. Allsuppliers have sourcing areas identified in the FSCRisk Assessments and the organization’s own riskassessment.

2.8 When sourcing from certified or verifiedland origin, the supplier code and claim for theapplicable third-party verification is included onsales and delivery documentation.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: Auditor reviewedmultiple invoices from all three suppliers. Allincluded the relevant COC or CW code.

2.9 The production site maintains a summary ofannual purchases and then sales to the MMCFproducer.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The summary ofpurchases and sales was available for reviewonsite by the auditor. Total amounts are indicatedin the sourcing information form.

2.10 All Suppliers provide outgoingtransportation documents that include theforest/plantation of origin and certificationstatus if relevant


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: The forest of origin isnot required on outgoing transportationdocuments for FSC or PEFC certification schemes.Instead, all suppliers are evaluated under FSCRisk Assessment where their sourcing areas areidentified. The organization has taken theadditional step of having a risk assessmentidentifying each supplier and their sourcing area,


and additional documents have been shared. Ifsourcing areas change, suppliers are required tonotify the organization at which time risk needs tobe evaluated. If material is imported, then countryof origin is indicated on the customs documents.FSC or PEFC claims were present on all documentsreviewed by the auditor.

Summary: The organization had a well-managed FSC and PEFC certification system, theywere used to keeping records and all required information for those schemes was includedin documents reviewed by auditor.

4. Sourcing from ancient and endangered forests and other controversial sources havebeen eliminated.

Indicators Findings

4.4 The production site/mill is aware of allrelevant local, national and international lawsand there is no evidence of non-compliance,with local, national or international laws.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding:.4.5 Production site/mill understands thedefinitions of Ancient and Endangered forestsand controversial sources. They also complywith the commitment to not procure woodfrom Ancient and Endangered forests andcontroversial sources.


Not Applicable

Commitment Met


Commitment Not Met



4.6 Production mills have conductedassessment of presence of ancient andendangered forests and other controversialforests in their wood supply areas.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: This is done at the levelof the organization. Risk Assessments wereconducted to identify ancient and endangeredforests and other controversial forests. SeeIndicators 2.1 – 2.2 and 4.

4.7 The sourcing from regions that containAncient and Endangered forests and othercontroversial sources is verified to low risk bythis CanopyStyle audit.


Not Applicable

Commitment Met


Commitment Not Met



Description of the finding: The organization’scommissioned scientific risk assessment identifiedsourcing from ancient and endangered or othercontroversial sources to be low risk, based ondefinitions provided by Canopy. However,according to Canopy’s assessment, low riskcannot be confirmed for all suppliers.

Summary: Most of the indicators were addressed in Appendix A, there is only one site.

5. Actions if suppliers contravene criteria

Indicators Findings

5.4 Production sites/mills have a documentedprogram for monitoring performance ofsuppliers which includes procedures foridentifying non-conformances to theCanopyStyle policy and sanctions to suppliersin such cases where non-conformances areidentified.


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: This indicator is notapplicable because the performance monitoring ofsuppliers is done at the corporate/organizationallevel rather than the site level.

Summary: Organization only has one site. Indicators were addressed in Appendix A.

7. Recognize, respect and uphold human rights and the rights of communities and workersaffected by the operations of their supply chain and affiliated companies.

Indicators Findings

7.1 The production site/mill has developed andadopts a similar policy, systems and proceduresto implement Free, Prior and Informed Consentof indigenous people and local communities.**


Not Applicable

Commitment Met


Commitment Not Met


Description of the finding: This indicator is notapplicable because the policy applies to both thecorporate/organizational level and site level.

7.2 The production site/mill document how theyconform with the MMCF producer’s commitmentto recognize and respect human rights,community rights, First Nations rights andrights of workers.


Not Applicable

Commitment Met


Commitment Not Met



Description of the finding: This indicator is notapplicable because the production site andcorporate/organizational level operate as oneentity with regards to 7.2

7.3 The production site/mills show responsiblehandling of complaints and resolution ofconflicts in a transparent and accountablemanner that is mutually agreed by the partiesand includes relevant stakeholders.


Not Applicable

Commitment Met


Commitment Not Met



7.4 The production site/mill and its suppliershave developed internal capacity andorganizational structure to recognize andrespect the rights of its workers.


Not Applicable

Commitment Met


Commitment Not Met



7.5 The production site/mill has developedprocedures to ensure commitment to theInternational Labour Organization (ILO)Declaration on Fundamental Principles andRights at Work and will require the equivalentof their own suppliers.


Not Applicable

Commitment Met


Commitment Not Met



7.6 Recognition and respect for human rights isdemonstrated. There is no evidence of avoidingor failing to resolve social conflicts and remedypast or current human rights violations.


Not Applicable

Commitment Met


Commitment Not Met




Summary: The organization only has one site. The organizations’ policies and procedurespertain to both the corporate and site level. All indicators in this section were addressedby indicators in Appendix A.


Appendix C: RECOMMENDATIONS FOR IMPROVEMENT

Recommendations for Eastman Chemical Company for continuous improvement

6 April 2020

Canopy applauds Eastman Chemical for embarking on the verification process in fall 2019,and demonstrating deep engagement with suppliers to identify fiber sourcing and examineany potential risks in the supply. These are important measures to ensure compliance withyour dissolving wood pulp sourcing policy.

The CanopyStyle audit is a learning opportunity, and in the spirit of continuousimprovement, additional actions can be taken over time to fully implement Eastman’spolicy commitments. Based on the review of the audit report, Canopy recommends thefollowing next steps:

1. Develop targets and timelines for the use of next generation alternative fibres inorder to rapidly enter the commercial scale phase;

2. For suppliers in the US South East, ensure and monitor that all fibre is subject toadequate mitigation measures now and in the future;

Continue to engage the supplier that is connected to the Royal Golden Eagle (RGE)family of companies, and actively monitor whether RGE and its connected companiesare embarking on an transformational path, to implement significant change on theground in Indonesia and increasing to scale up of next generation fibre solutions.

3. Increase the amount of FSC fibre used, with a preference for fibre from FSC certifiedforests (FSC 100%);

4. Build on the company’s initial action to support the conservation of a key landscapeof hope in Leuser Ecosystem and Vancouver Island, to include advocacy for otherkey regions globally;

5. Continue to adopt best in class processing and work with experts in the field tocontinuously meet new standards related to chemical discharge and pollution.

We recommend that the company develops an action plan to address these priority issues,so that they can be addressed before the next annual audit.

As mentioned in the CanopyStyle audit framework, ongoing audits and/or random sitevisits will be essential to ensure that Eastman Chemical Company continues to implementtheir policy and meets the expectations of the CanopyStyle Initiative.

Once again, we congratulate you for the timely completion of the audit and for proactivelytaking steps to reduce risk in your supply chain. We look forward to working collaborativelywith Eastman to address any outstanding issues.

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