Tissue Paper Industry ESG Thematic Report, 2023

Environmental, Social and Governance (ESG) in the Tissue Paper Industry

The acronym ESG stands for Environmental, Social, and Governance (ESG) and emphasizes that sustainability extends beyond the environment. Environmental issues such as air and water pollution, climate change, overflowing landfills, and clear cutting have all contributed to an increase in government regulations. A trend toward sustainability is emerging as the pulp and paper sector reduces clearcutting, water use, greenhouse gas emissions, fossil fuel consumption, and air pollution as well as reduces clearcutting.

Tissue paper is linked to environmental and social issues. There are several risks which are also associated with the industry. Tissue paper is increasingly used in developed nations. There are approximately 50 pounds of tissue products used by Americans every year. This is more than half of what Western Europe and Japan consume, and the usage has increased substantially over the last few decades. This soft tissue paper is hard on the environment, and the industry has often been criticized for deforestation. Sustainability is becoming one of the biggest risks and opportunities for tissue manufacturers.

Impact of Tissue paper industry in terms of ESG

Tissue paper manufacturing adversely affects the environment. Even though tissue papers are made from recycled wastepaper and virgin pulp, virgin pulp emits 30% more Greenhouse Gas (GHGs) than recycled waste paper. For the manufacture of one roll of toilet paper, approximately 140 gallons of water are required. Worse, chlorine is used to bleach the pulp, so it looks white while some other chemicals are used to soften it which eventually pollutes the water bodies.

There are also significant impacts on biodiversity or forest due to the tissue paper industry, including toilet paper, facial tissue, and paper towels, which contribute to logging in the Boreal Forest. Virgin pulp accounts for 23% of Canadian forest exports. Boreal forests are not the only forests affected by unsustainable tissue paper manufacturing. In the Southeastern United States, more than half of trees are less than 40 years old due to deforestation.

Toilet paper has a shorter life span than a plastic package, and it can never be reused, so it ends up in liters. Thus, a tree is essentially planted on the other side of the world—only to be cut down after 20-50 years, travel from far to a toilet paper manufacturing plant, shipped to a store, purchased by the consumer, and used for a mere 5 seconds. Nearly 10% of deforestation worldwide occurs because of toilet paper production, but only 30% of the world's population uses it. Every day, nearly 27,000 trees are flushed, and most of the trees being replanted are monocultures, which displace diverse native plants and animals.

ESG Trends

To reduce the negative environmental impact, tissue paper manufacturers can stop using virgin forest fiber, and substitute recycled fibers instead, which will have a fraction of the environmental impact. Tissues made from 100% recycled fiber have one-third the carbon footprint as tissues made from virgin forest fiber.

It is also becoming increasingly popular to use bamboo as a fiber source since it occupies considerably less space than forests specifically planted for logging. Bamboo is not perfect, but products made from the plant emit 30% fewer GHGs than those made from virgin forest fiber. Additionally, products containing the Forest Stewardship Council logo indicate that the brand is committed to reducing reliance on forest fibers. According to the United States Environmental Protection Agency, consumers should choose recycled toilet paper that has a post-consumer fiber content of 20 - 60% and a recovered fiber content of 20 - 100%.

The timber-producing countries could also be incentivized to support the legal market by reducing taxes or providing other financial rewards. This is a short-term solution but may help establish a legal environment in which timber prices are not driven down by illegal timber harvesting.

Our society needs to develop a more resilient, sustainable way to live. Apart from manufacturers, consumers should also take responsibility for choosing the right product and reducing our contribution to deforestation.

Growth of the Tissue Paper Market

In 2021, the tissue paper market was worth USD 20.86 billion, and it is expected to grow at a compound annual growth rate (CAGR) of 3.3% over the next five years. Moreover, growing awareness about sanitation and personal care is likely to boost market demand because people are becoming more sensitive to hygiene and cleanliness. As government initiatives focus on developing eco-friendly and sustainable consumer products, biodegradable tissue paper products are anticipated to be in high demand. Thus, major tissue paper manufacturers are investing in the development of biodegradable and recyclable products to reduce the extensive cutting of trees, thus reducing the burden on the environment.

Key Companies in this theme

    • Procter & Gamble (Cascade)

    • Kimberly – Clark

    • Essity

    • Kirkland Signature (Costco)

    • Georgia- Pacific

    • Solaris Paper

Scope of the Tissue Paper Industry ESG Thematic Report

    • Macro-economic and ESG-variable analysis of the industry, including regulatory, policy, and innovation landscape

    • Key insights on infrastructure developments and ESG issues affecting the theme

    • Identify key initiatives and challenges within the industry

    • Identify ESG leaders within the industry

    • Understand key initiatives and the impact of companies within the sector to fuel an informed decision-making process.

    • Analysis of industry activities based on multi-media sources, including significant controversies and market sentiment

Key Benefits of the Tissue Paper Industry ESG Thematic Report

    • Developing a comprehensive understanding of macro-economic, Policies & Regulations and innovations affecting the tissue paper sector, globally

    • Key insights into Infrastructure developments and ESG issues affecting the theme

    • Identifying ESG risks and opportunities to business among leading players in the industry

    • Obtaining a clear and relevant understanding of company actions, progress, and impact and find opportunities for investment