Initiatives for Environmental Issues— Sustainability —Sustainable Forest Management and Biodiversity Conservation

Sustainable Forest Management
Basic Approach

Renewable Forest Resources

The appropriate cultivation and management of forests not only produces renewable forest resources; it also helps to enhance themulti-faceted functions of forests, including absorbing and fixing CO2, conserving biodiversity, cultivating water resources, and preserving soil. To meet such environmental challenges as dealing with global warming and conserving biodiversity, our purpose is tofully leverage the functions of forests that are the precious assets of the Oji Group in pursuing our business activities. We believe thatcontinuing to “grow forests and utilize forests” will produce exceedingly important value, both for the environment and for society.

Forests are a renewable resource that can be planted, grown,harvested, and re-planted. To make cascading use of trees(thorough use of every part of trees), the Oji Group utilizes thePlanting

Overview of the Oji Group’s Forests (Oji Forests)

Woodchips
Biomass fuels

Weeding

New ZealandIndonesia
Vietnam
Other (3 companies in Vietnam and Australia)
Overseas subtotal
Company-owned forests in Japan
Group total

Conservation Forests in Japan by Function

Businesscompany

Production forests Conservation forests
Total
Established(1,000 ha) (1,000 ha) (1,000 ha)

CENIBRAPan Pac
SPFLOji FS
KTH
QPFL

1973
1971
1992
2014
1998
1995
———

106
5
3
1
19
1
1136
12148

250
41
13
882
10
11415
188
603

Production forests : forests primarily for producing forest products in consideration ofenvironmental conservation.
Conservation forests : forests primarily for environmental conservation, including protecting
biodiversity and basins.

TopicsCascading use of forest resourcesThe lumber, laminated lumber, and the raw materials
for plywood come from the thick trunk part of forest
plantation trees. The sawmill residue from the production of lumber, and the tips of those trunks which cannot be used for lumber, are thoroughly utilized aswoodchips for paper manufacturing or biomass fuel.

CENIBRA in Brazil: Production forest (left) and conservation forest (right)

Oji Group’s Forests by Country

144
36
10763
910279176
455

Growth(In the case of larch :40 to 60 years until fullgrowth)

Thinning

Of the 603,000 ha of forests owned and managed by the Group in Japan and overseas, approximately 25%, i.e., 148,000 ha areconservation forests, which are managed with consideration for the environment and ecosystems. Specifically, of the forests managed by CENIBRA, Brazil, conservation forests account for as much as about 42%.
In Japan, 12,000 ha out of 188,000 ha of company-owned forests are conservation forests designated for preserving biodiversity,
maintaining landscapes around recreational facilities (conservation for forest utilization), preventing soil runoff and collapse (land conservation), preserving water sources, and protecting scientifically valuable forests. Since one forest may have multiple functions, thecumulative total area of environmental conservation functions is 17,000 ha.
We will continue to maintain and properly manage conservation forests that contribute to the conservation and promotion of biodiversity.

Brazil

Sawmill residue is madeinto woodchips, etc.

Sustainable Forest
ManagementLumber, laminated lumber,plywood, etc.

Conservation Forests

Country

Pulp, paper,particleboard,etc.

Earned the Highest “A” Score in the CDP
Forests Category (Timber Products)

Conservation forestfunctions

Forest area*1(actual area) (ha)Function area*2(cumulative total) (ha)Biodiversity conservation

9,742

9,495

Conservation for forest
utilization

710

4,357

Land conservation

818

2,735

Water conservation

275

532

88

11,552

17,127

Conservation for scientificresearch
Total*1 Each conservation forest is categorized by its main function,and forest areas are aggregated by category.
*2 Each function area shows the cumulative total of the areas offorests with that function regardless of their main functions’categories.

Social Contributions That Are Environmentallyand Economically Friendly to Local Communities
Sustainable forest management requires a mutual understanding between forest plantation companies and the local communities, grown through considering environmental, social,and economic effects for the community. To give an example
of economic contribution, our overseas forest plantation companies have created approximately 15,000 jobs locally. Another such example is our technical training primarily on planting and forest management provided to owners of small-scaleforests. Further, we cooperate with local governments, NGOs,and civic groups in each region to create and share environmental and social benefits. Their activities include biodiversity
conservation programs in environmentally protected forests,
vocational and educational support in local communities, andassistance in areas that have poor access to medical services.

TopicsCENIBRA supports beekeeping

Initiatives for Environmental Issues — Sustainability —The Oji Group owns and manages extensive forests in Japanand overseas, amounting to 603,000 ha. The portfolio comprises 455,000 ha of production forests primarily for producing forest products in consideration of environment, and about
1 4 8,0 0 0 ha of conservation forests principally for preserving
biodiversity and basins.
Wood from production forests is expected to be used as
raw materials for paper manufacturing and fuels for biomass
power generation, and for new materials derived from woodcomponents under development. In order to maintain stablesupply of these wood raw materials, the Oji Group spends
approximately 14.2 billion yen annually for ongoing sustainable
forest management. In addition, our Environmental Action
Program 2030 states a goal of expanding overseas production forest area to 400,000 ha.

harvested wood for lumber, plywood, woodchips for paper
manufacture, wood biomass fuel, etc.
The Oji Group promotes the effective utilization of wood as
a comprehensive forestry business group.

Oji Fibre Solutions supports an
educational program of Graeme
Dingle Foundation

Establishment of Oji Forest Value-Creation & Promotion Department

The Oji Group established the Oji Forest Value-Creation & Promotion Department in October 2022 to utilize diverse functions of theforests it owns and manages toward achieving its Purpose. The Oji Forest Value-Creation & Promotion Department seeks to util i z e f o re s t re s o u rc e s t o c re a t e n e w
businesses and expand research areas,
while conducting various surveys, searchingfor partners, and sourcing investment opportunities to solve social issues and increase corporate value.

Forests’ Multi-functionality and Ecological Services
Landslide disaster prevention function / soil conservation function
Biodiversity conservation function
Global environment conservation function
Cultural function
Material production function

Oji Holdings was added to the “A list” of top-scoring companies selected by CDP, an international non-profit organization for the first timein 2022, which recognized its leadership in transparency and performance in corporate sustainability concerning forests (timber products).
Leisure and recreation function

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The Oji Group Integrated Report 2023

Water source cultivation function

The Oji Group Integrated Report 2023

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Initiatives for Environmental Issues— Sustainability —Sustainable Forest Management and Biodiversity Conservation

Biodiversity Conservation
Basic Approach
The Oji Group has declared to seek “Harmony with Nature and Society” in its Management Philosophy and has set the goal ofconserving biodiversity and reducing our impact on the environment under its Environmental Vision 2050 and Environmental Action Program 2030. To that end, the Group works for forest management with consideration for ecosystems, protection and nurturing of rare plants and animals, research and development of biodegradable and biomass materials for ecosystem maintenance,and purification of wastewater and exhaust gases.
With regard to forests, in particular, as well as the need of sustainable forest management for the continuation of our businessas a company that use forest resources, we recognize the importance of conservation and promotion of biodiversity as a social
responsibility of a company that owns and manages vast forests. We maintain natural forests’ ecosystems rich in biodiversity, andproperly manage our plantations to help the formation of multilayered vegetation and healthy ecosystems.
In Japan and overseas, we work with governments, environmental NPOs, academic researchers, and local community to protect and nurture endangered species and maintain and restore ecosystems.

The 30by30 Alliance for Biodiversity
We have joined the 30by30 Alliance for Biodiversity, which was voluntarily launched by companies, local governments, and organizations in April 2022 under the initiative of the Ministry of the Environment in Japan, towards the international goal of protecting at least
30% of land and sea by 2030. The Alliance members provide support for registering their owned or controlled lands as OECM* andexpanding protected areas, and provide support.
* Other Effective area-based Conservation Measures. Areas where biodiversity is being conserved throughefforts by the private sector, such as corporate forests and satoyama.

The Oji Group has been working in collaboration with the Ecosystem Trust Society sinceAugust 2016 in activities to protect fairy pitta’s growing environment in the Koyagauchi
company-owned forest in Kochi Prefecture. For this company-owned forest, we have already applied for screening for certification under a “trial scheme to certify conserved areas*” conducted by the Ministry of the Environment in FY2022. We aim to obtain OECM
certification through final certification under the Ministry’s scheme.
* A national scheme to certify areas where biodiversity is being conserved through efforts by the private
sector or other parties. The certified areas, other than protected areas, will be registered as OECM on aninternational database.

In 2009, the Oji Group established the Sarufutsu Itou Conservation Council with a local NPO, administrative bodies,
researchers, and others for the purpose of protecting theJapanese huchen called itou, or the sea-run taimen (Huchoperryi), an endangered species that lives in the river zone of
the Sarufutsu forest in Sarufutsu village, Hokkaido. An areaof 2,600 ha including the river zone was designated a conservation area. Activities include the removal of artifacts
that obstruct the itou from migrating upstream, and surveys
on spawning beds and the number of individuals migratingupriver.

Nuptial-colored itou (male) Photo by Yo Chirai(Listed as an Endangered IB on the Ministry of the Environment Red List)

Alpine Plant Community Restoration Activities(Samani Company-owned Forest in Hokkaido)
The alpine plant community on Mt. Apoi is home to many endemic plants with place names such as “Apoi,” “Samani,”and “Hidaka,” and was designated a national special naturalmonument in 1952. While the local government and people
continue to work together to maintain trails to prevent trampling, patrol the area to prevent illegal digging, and conduct
restoration experiments, the Oji Group provides support
such as offering a site for restoring alpine plants.

Samani yukiwari blooming on the trailside

Apoi-azumagiku blooming in a test site

Initiatives for Maintenance and Restoration of Ecosystems
Protection against Forest Fires (CENIBRA, Brazil)
Fairy pitta in the Koyagauchi company-ownedforest. Listed as an Endangered IB on the Ministryof the Environment Red List.
Photo provided by the Ecosystem Trust Society

CENIBRA has introduced an innovative forest fire prevention
and fighting system using artificial intelligence (AI) for their250,000 ha forests. The company has installed 38 watchtowers equipped with 360 degrees rotating cameras in the forests. When the AI detects smoke and fires, the monitoring

Initiatives for Environmental Issues — Sustainability —Initiatives for Protection and Nurturing of Rare Animals and Plants

Itou Conservation Activities in Sarufutsu(Sarufutsu Company-owned Forest in Hokkaido)

room notifies fire crews nearest to the site of the incidents.
They start firefighting immediately. The AI-equipped cameras
are more efficient than human eyes and can locate the accurate fire site within one to two minutes. CENIBRA has reduced forest fire risks significantly.

Conservation Activity for Kiwi (Pan Pac, New Zealand)
Pan Pac conducts activities for protecting kiwi, a rare bird species, in cooperation with theMinistry for the Environment of New Zealand, citizen volunteers, and other parties. For
these activities, the company has designated land of an area of approximately 40 ha as akiwi sanctuary for protecting kiwi chicks. Chicks and eggs in the surrounding area are captured and collected, and chicks that are captured or hatched from the collected eggs arenurtured in the sanctuary before being returned to the wild.
In June 2019, Pan Pac was named Community Corporate Sponsor of the Year at a national kiwi conference held by “Kiwis for kiwi,” a kiwi protection organization.

Kiwi
Fire watchtower

Monitoring of Biodiversity Indicators (CENIBRA, Brazil)
In collaboration with external research institutions, universities, NGOs, and other organizations, CENIBRA monitors plants and animals and water resources, and conducts various
ecosystem protection and conservation activities.
Monitoring results up until 2021 confirm that endangered 31 species of birds and 17
species of mammals are
inhabited in CENIBRA’sconservation forest.
CENIBRA is engaged inactivities for breeding
Plantation*2
Waste land*1
mutum (crax blumembaProtected forest
Protectedforestchii), an endangered birdspecies, and several other species, and returningthem to nature, and is
implementing a GreenCorridor Program to link
Green Corridor Program
separated habitat areas.
*1 Expanding forest areas by restoring waste lands to connect neighboring
natural forests.
*2 Plantations also serve to protect protected forests from erosion from thesurrounding area.

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The Oji Group Integrated Report 2023

Fire monitoring in the monitoring room

Firefighting training by firefighters

Efforts to Preserve and Restore Natural Forest (Pan Pac,New Zealand)

Buffy-headed marmoset (CR)

Mutum (VU)
† IUCN Red List Categories: CriticallyEndangered (CR), Vulnerable (VU)

The forest land located just north of Pan Pac’s Whirinaki Mill
with a total area of 298 ha includes about 23% (68 ha) of
well-established indigenous (native) forest.
Pan Pac partnered with a government organization toplace the forest reserve into a conservation covenant. The
reserve area comprises tree species unique to the Hawke’s
Bay region, and given the forest’s age and previous protection from animal livestock and pests, the native tree population holds particular ecological and cultural importance. PanPac will be working with specialists to harvest rare seeds toassist in local and national programs of native forest regeneration. The company also hopes to welcome schools to thearea for educational visits.
In June 2021, Pan Pac received funding approval throughthe government’s “Jobs for Nature Fund.” The money will be

used to fence the reserve area and plant an additional 12 haof native plants on bare land areas to speed up restoration.

A view of the reserve

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