Heiskanen, Aleksi
(Helsingfors universitet, 2013)
The pulp and paper industry has gone through severe structural changes during the past decade. The shift from traditional production areas towards new operational environments has caused some challenges in adapting to these environments. Every organisation in the pulp and paper industry has its own strategy to meet the requirements from the market and regulators, but there are options, such as different certification schemes introduced along the past decades. Sustainable financing has become one of these options, and its utilisation has been increasing. Financing taking into account non-financial characteristics is also called sustainable financing.
According to the previous research, sustainable financing may encourage the implementation of corporate commitments to enhance risk management, and improve stakeholder management. Also, these functions that go beyond purely financial objectives may generate implicitly positive results in the form of competitive advantage, brand value, stakeholder support for operations, enhanced access to capital and ultimately lower cost of capital. Sustainable financing may also answer the need for enhanced sustainability and transparency in the financial sector. However, the concept of sustainable financing and its vagueness have also been criticised. Therefore, the objective of this study is to analyse the main actors and functions inside the system, obstacles hindering the further adoption and drivers to promote the adoption, and ultimately, examine the possible impacts of sustainable financing.
The methods used to conduct this study were qualitative and based on multiple data sources. First, the basic concept of sustainable financing was explored based on the literature, and secondly empirical data was collected through selected thematic interviews. The representative data is divided roughly into two categories, supply and demand. The supply represents organisations providing sustainable financing, including private and non-private actors. The demand includes private companies in the pulp and paper industry. The interviewees were asked questions about the current and expected future situation and the situation inside organisation and the concept as perceived in general.
The understanding of sustainable financing still remains relatively vague. Unexpectedly, only few obstacles hindering the further adoption were identified. The actors were in general more generous in identifying drivers for further adoption. Motives were considered mostly originating from changes in the operational environment. This suggests that sustainable financing is still seen to be part of a broader context such as corporate responsibility, but it has emerging significance in the interaction with other issues such as risk mitigation, stakeholder management and strategic corporate responsibility.
The study was to reveal whether sustainable financing influences investment decisions in the case of the pulp and paper industry. The impact of sustainable financing remains relatively low. However its emerging significance was not denied. This may be partly explained by the fact that it is still perceived to be a part of a larger context of CSR. On the other hand, no significant trade-offs were identified. Indisputably sustainable financing possesses a great potential and it is a good starting point for how different organisations can collaborate to achieve common goals; enhanced long-term economic viability and better practices.