Mike Doss

OUR COMMITMENT TO ESG

“ESG principles are integral to our Vision 2025 goals and guide how Graphic Packaging innovates for a healthier planet, supports and develops employees, champions with our partners, engages with our communities and operates responsibly. As a vertically-integrated business, we incorporate sustainability at each stage of our manufacturing process. Our design for environment approach and culture of innovation enables us to partner with our customers in the global transition to a more circular economy, while organically growing our business.”

INVESTING IN A MORE
SUSTAINABLE AND
PROFITABLE FUTURE

As a paperboard packaging company focused on developing the best renewable and recyclable products for our consumers, customers, and the planet, sustainability is in our DNA. Our new K2 paper machine in Kalamazoo, Michigan is one of our largest investments and will provide significant improvements in water and energy usage and enable us to be the lowest-cost producer of high-quality coated recycled board.

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2019 ESG HIGHLIGHTS

470 Million

units of foam and plastic cups converted to paper

21%Women

in senior leadership roles. Women comprise 30% of middle management

4%Reduction

in Recordable Incident Rate (RIR), reduced from 1.09 to 1.05

100%

of global facilities compliant in Graphic Packaging's forest/fiber certification standard

$161 Million

in goods and services purchased from more than 500 diverse suppliers as part of our diversity in procurement program

5% Reduction

in GHG emissions/ saleable ton (’19 vs. ’18) in our SBS Mills

OUR BUSINESS STRATEGY

We intend to redefine leadership in the paperboard packaging industry with our Vision 2025. Our vision outlines how we will be better stewards of our planet, supporters of our people, allies to our partners, all while generating returns for our shareholders. Vision 2025, which guides our sustainability-driven business strategy, lays out bold goals and objectives that allow us to measure our progress and ensure we are on track. The four pillars of Vision 2025 are:

planet

Planet

Leverage industry-leading sustainability profile, reducing impact on the environment

Show goals and progress
people

People

Engage employees in a high-performance culture

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Partners

Partners

Grow with the best customers in the best markets

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planet

Profit

Generate superior returns

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Greenhouse Gas Emissions

Greenhouse Gas Emissions

Goal
15%* reduction in GHG
emissions (CO2e/sales)
Progress through 2019 over base year
Non-Renewable Energy

Non-Renewable Energy

Goal
15%* reduction in non-renewable energy (MMBtu/sales)
Progress through 2019 over base year
0.1% reduction
Water Conservation

Water Conservation

Goal
15%* reduction in water usage (gallons/saleable ton)
Progress through 2019 over base year
1.3% reduction
Recyclability

Recyclability

Goal
100% products recyclable
Progress
97% 81% nationally
16% regionally
Reducing Plastic

Reducing Plastic

Goal
40%** reduction in LDPE usage
Progress through 2019 over base year
4.3% reduction
Recovery Rate

Recovery Rate

Goal
70% increase industry
recovery rate of paper and paperboard in 2020
Progress
66.2% recovery rate
(American Forest & Paper Association)
Waste Diversion

Waste Diversion

Goal
Drive out waste in all our operations
Progress
100% of global carton manufacturing plants engaged in a waste diversion program
Forest and Fiber Certification

Forest and Fiber Certification

Goal
100% of global facilities compliant in Graphic Packaging's forest/fiber certification standard
Progress
100% of facilities globally compliant

*Company goals from base year of 2016 **Company goals from base year of 2018

Engagement

Engagement

Goal
Top quartile engagement scores
Progress
Bi-monthly Global Town Hall web events; Coffee with CEO
Safety

Safety

Goal
Continue progress to aspirational goal of 0 incidents
Progress
Global incident rate reduced by 1.05 (4% decrease YoY)
Growth and Performance

Growth and Performance

Goal
Play on a winning team
Progress
Xccelerated Performance (XP) pilot; plans to scale globally
Development & Training

Development & Training

Goal
GPI University 30 hours of training per employee, per year
Progress
On track for “back to school” grand opening in Fall 2021
Talent Acquisition

Talent Acquisition

Goal
Attract and retain the right talent
Progress
Robust succession plans for Top 100 Roles; pipeline talent program for High Potentials
Market Share

Market Share

Goal
#1 paperboard market share in North America & Europe
Progress
~3.8 million tons of paperboard produced in 2019, #1 and #2 in three markets served
Growth

Growth

Goal
100–200 bps/year sustainability supported, organic growth
Progress
Pivot to net organic growth in 2H19; 300 bps of net organic sales growth in 1H20
New Product Sales

New Product Sales

Goal
$400M - $700M net new product sales 2020-2025 included in organic growth
Progress
$100 million in net organic sales in 1H20; new products accounted for more than half
Mergers & Acquisitions

Mergers & Acquisitions

Goal
Strategic, high return M&A
Progress
Artistic Carton acquisition in 2019; Quad and Consumer Packaging Group acquisitions in 1H20
Margin Growth

Margin Growth

Goal
$400M –$500M in productivity 2020-2025 to drive margin growth
Progress
Achieved $74 million in net productivity in 2019
Profit 2019 Vision 2025
Paperboard Integration 68% 80-90%
Sales $6.2B ~$10B
ADJ EBITDA Margins 16.7% 18-20%
ROIC 8% 10-12%
ADJ EPS $0.87 $2.00+
Normalized Capex (% Sales) 5% 5%

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Our sustainability journey