RepRisk Director's Brief

Stora Enso OYJ

September 2016

What is the Director’s Brief?

The RepRisk Director's Brief

The RepRisk Director’s Brief is a corporate benchmarking report. It assesses your company’sexposure to environmental, social, and governance (ESG) risks, and benchmarks it with acustomizable peer list. The Brief is a data-driven strategy and decision-making tool designedfor board members and executives, investor relations and corporate affairs professionals, aswell as CSR and sustainability teams.

The RepRisk Rating

The cornerstone of the Director’s Brief is the RepRisk Rating – a proprietary risk metric,ranging from AAA to D, that captures and quantifies a company’s risk exposure related to ESGissues. It combines a company’s own ESG risk exposure with the ESG risk exposure of thecountries and sectors in which the company has been exposed to risks.

The RepRisk Rating facilitates corporate benchmarking and ESG integration, and providesdecision support in risk management, compliance, investment management, and procurement.Based on RepRisk’s strict, rules-based methodology, the Rating is updated daily for allcompanies in the RepRisk ESG Risk Platform.

AAA AA A

Low ESG Risk Exposure

RepRisk Rating

BBB BB B

Medium ESG Risk Exposure

CCC CC C

High ESG Risk Exposure

D

Very high ESG RiskExposure

Director’s Brief: Stora Enso OYJ September 2016 2

ESG Risk ExposureCompany: Stora Enso OYJ

The current RepRisk Rating of Stora Enso OYJ is A, denoting a low risk exposure. Thetimeframe of this report is the last two years (October 2014 to September 2016).

Top ESG Issues Top ESG Topic Tags Top countries with ESG risk exposure

1. Human rights abuses, corporatecomplicity

1. Genetically modified organisms(GMOs)

1. Pakistan

2. Child labor 2. Land grabbing 2. India

3. Supply chain issues 3. Negligence 3. China

4. Forced labor 4. Uruguay

5. Violation of national legislation 5. Brazil

The next pages provide further details on the RepRisk Rating, the top ESG Issues and top ESGTopic Tags of Stora Enso OYJ and its peers, as well as about the countries where Stora EnsoOYJ has been exposed to ESG risks.

Director’s Brief: Stora Enso OYJ September 2016 3

Peer benchmarking ESG RiskExposureCompany: Stora Enso OYJ

The overall ESG risk exposure of a companyis measured by the RepRisk Rating. TheRepRisk Rating is made up of two factors:

The Company-specific ESG Risk captures theexposure due to risk incidents reportedspecifically about the company (X-axis). Thisrisk is measured by the company’s RepRiskIndex (RRI), RepRisk’s proprietary measureof ESG risk exposure.

The Country-Sector ESG Risk measures thecompany’s international risk exposure takinginto consideration its sector and the locationof the company’s headquarters, as well asthe countries where the company has beenexposed to ESG risk incidents (Y-axis).

Both of these risk metrics range from zero to100. The higher the value, the higher therisk exposure.

Company and Ranking RepRisk Rating Company-specificESG Risk

Country-SectorESG Risk

UPM-Kymmene OYJ AA 24 20

Stora Enso OYJ A 29 24

International Paper BBB 35 29

Samling Global BBB 31 37

Celulosa Arauco y Constitucion BB 28 42

Holzindustrie Schweighofer B 39 41

Veracel Celulose B 23 61

Empresas CMPC B 46 40

Vicwood Group CC 50 57

Societe Industrielle et Forestiere du Congo D 39 88

Director’s Brief: Stora Enso OYJ September 2016 4

ESG IssuesCompany: Stora Enso OYJ

The heat map below highlights the ESG Issues that have been mostly associated with StoraEnso OYJ in the last two years. The Issues are highlighted in relation to both the number andseverity of the risk incidents.

The 28 ESG Issues in the heat map comprise the core of RepRisk’s research scope. TheseIssues were selected and defined in accordance with the key international standards related toESG, such as the World Bank Group Environmental, Health, and Safety Guidelines, the IFCPerformance Standards, the OECD Guidelines for Multinational Enterprises, and the ILOConventions. In particular, the scope covers the Ten Principles of the UN Global Compact(UNGC).

Environmental Social GovernanceEnvironmental Footprint Community Relations Employee Relations Corporate Governance

Global pollution (incl. climatechange and GHG emissions)

Human rights abuses,corporate complicity

Forced labor Corruption, bribery, extortion,money laundering

Local pollution Impacts on communities Child labor Executive compensationissues

Impacts on ecosystems andlandscapes

Local participation issues Freedom of association andcollective bargaining

Misleading communication,e.g. “greenwashing”

Overuse and wasting ofresources

Social discrimination Discrimination in employment Fraud

Waste issues Occupational health andsafety issues

Tax evasion

Animal mistreatment Poor employment conditions Tax optimization

Anti-competitive practices

Cross-cutting Issues: always in combination with one of the ESG Issues above

Controversial products and services

Products (health and environmental issues)

Violation of international standards

Violation of national legislation

Supply chain issues

Low risk Medium risk High risk Very high risk

Director’s Brief: Stora Enso OYJ September 2016 5

ESG Topic TagsCompany: Stora Enso OYJ

The heat map below highlights the ESG Topic Tags that have been mostly associated withStora Enso OYJ in the last two years. The Topic Tags are highlighted in relation to both thenumber and severity of the risk incidents.

The 45 ESG Topic Tags in the heat map are part of RepRisk’s research scope. Topic Tags arespecific and thematic ESG “hot topics” that are an extension of RepRisk’s core research scopeof 28 ESG Issues. Topic Tags are a dynamic concept, with the list expanding over time inresponse to emerging trends.

Abusive/Illegal fishing Agricultural commodityspeculation

Alcohol Animal transportation

Arctic drilling Asbestos Automatic and semi-automaticweapons

Cluster munitions

Coal-fired power plants Conflict minerals Coral reef Deep sea drilling

Depleted uranium munitions Diamonds Drones Endangered species

Forest burning Fracking Gambling Genetically modifiedorganisms (GMOs)

Genocide/Ethnic cleansing High conservation valueforests

Human trafficking Hydropower (dams)

Illegal logging Indigenous people Involuntary resettlement Land grabbing

Land mines Migrant labor Monocultures Mountaintop removal mining

Negligence Nuclear power Oil sands Palm oil

Pornography Predatory lending Privacy violations Protected areas

Rare earths Sea-bed mining Soy Tobacco

Water scarcity

Low risk Medium risk High risk Very high risk

Director’s Brief: Stora Enso OYJ September 2016 6

Country ESG Risk ExposureCompany: Stora Enso OYJ

In the last two years, ESG risk incidents for Stora Enso OYJ have been detected in 11 countries.The map below highlights these countries in relation to both the number and severity of therisk incidents.

Country and ranking

1. Pakistan 6. Finland

2. India 7. Korea; Republic of (South Korea)

3. China 8. Lao People's Democratic Republic

4. Uruguay 9. Sweden

5. Brazil 10. Latvia

Low risk Medium risk High risk Very high risk

Director’s Brief: Stora Enso OYJ September 2016 7

Peer benchmarking ESG IssuesCompany: Stora Enso OYJ

The two tables in this section compare Stora Enso OYJ and its peers according to their key ESGIssues in the last two years.

The table below displays the top five ESG Issues of Stora Enso OYJ in the last two years andbenchmarks the peers on these Issues. The Issues are highlighted in relation to both thenumber and severity of the risk incidents.

Benchmarking on Stora Enso OYJ's top ESG Issues

Company and Ranking Human rightsabuses,

corporatecomplicity

Child labor Supply chainissues

Forced labor Violation ofnational

legislation

1. UPM-Kymmene OYJ

2. Stora Enso OYJ

3. International Paper

4. Samling Global

5. Celulosa Arauco y Constitucion

6. Holzindustrie Schweighofer

7. Veracel Celulose

8. Empresas CMPC

9. Vicwood Group

10. Societe Industrielle et Forestiere du Congo

Low risk Medium risk High risk Very high risk

Director’s Brief: Stora Enso OYJ September 2016 8

Peer benchmarking ESG IssuesCompany: Stora Enso OYJ

The table below displays the top five ESG Issues that have been the most prevalent among thegroup of selected peers in the last two years and benchmarks Stora Enso OYJ and the peers onthese Issues. The Issues are highlighted in relation to both the number and severity of the riskincidents.

Benchmarking on the peers' top ESG Issues

Company and Ranking Impacts onecosystems

andlandscapes

Violation ofnational

legislation

Impacts oncommunities

Human rightsabuses,

corporatecomplicity

Localpollution

1. UPM-Kymmene OYJ

2. Stora Enso OYJ

3. International Paper

4. Samling Global

5. Celulosa Arauco y Constitucion

6. Holzindustrie Schweighofer

7. Veracel Celulose

8. Empresas CMPC

9. Vicwood Group

10. Societe Industrielle et Forestiere du Congo

Low risk Medium risk High risk Very high risk

Director’s Brief: Stora Enso OYJ September 2016 9

Peer benchmarking ESG Topic TagsCompany: Stora Enso OYJ

The two tables in this section compare Stora Enso OYJ and its peers according to their key ESGTopic Tags in the last two years.

The table below displays the top five ESG Topic Tags of Stora Enso OYJ in the last two yearsand benchmarks the peers on these Topic Tags. The Topic Tags are highlighted in relation toboth the number and severity of the risk incidents.

Benchmarking on Stora Enso OYJ's top ESG Topic Tags

Company and Ranking Geneticallymodified

organisms(GMOs)

Landgrabbing

Negligence N/A N/A

1. UPM-Kymmene OYJ

2. Stora Enso OYJ

3. International Paper

4. Samling Global

5. Celulosa Arauco y Constitucion

6. Holzindustrie Schweighofer

7. Veracel Celulose

8. Empresas CMPC

9. Vicwood Group

10. Societe Industrielle et Forestiere du Congo

Low risk Medium risk High risk Very high risk

Director’s Brief: Stora Enso OYJ September 2016 10

Peer benchmarking ESG Topic TagsCompany: Stora Enso OYJ

The table below displays the top five ESG Topic Tags that have been the most prevalent amongthe group of selected peers in the last two years and benchmarks Stora Enso OYJ and the peerson these Topic Tags. The Topic Tags are highlighted in relation to both the number andseverity of the risk incidents.

Benchmarking on the peers’ top ESG Topic Tags

Company and Ranking Illegallogging

Indigenouspeople

Monocultures Protectedareas

Endangeredspecies

1. UPM-Kymmene OYJ

2. Stora Enso OYJ

3. International Paper

4. Samling Global

5. Celulosa Arauco y Constitucion

6. Holzindustrie Schweighofer

7. Veracel Celulose

8. Empresas CMPC

9. Vicwood Group

10. Societe Industrielle et Forestiere du Congo

Low risk Medium risk High risk Very high risk

Director’s Brief: Stora Enso OYJ September 2016 11

About RepRisk

RepRisk is a leading business intelligence provider, specializing in environmental, social, andgovernance (ESG) risk analytics and metrics.

Harnessing a proprietary, systematic framework that leverages cutting-edge technology andhands-on human intelligence in 15 languages, RepRisk curates and delivers dynamic riskinformation for an unlimited universe of companies.

Since 2006, RepRisk has built and continues to grow the most comprehensive ESG riskdatabase that serves as a due diligence, research, and monitoring tool in risk management,compliance, investment management, corporate benchmarking, and supplier risk. The RepRiskESG Platform currently includes risk profiles for over 76,000 listed and non-listed companies,19,000 projects, as well as for every sector and country in the world.

Headquartered in Zurich, Switzerland, RepRisk serves clients worldwide including globalbanks, insurance providers, investment managers, and corporates, helping them to manageESG and reputational risks in day-to-day business.

RepRisk provides the transparency needed to enable better, more informed decisions. Formore information, please visit www.reprisk.com.

Disclaimer

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