Stora Enso Oyj (Swedish: Stora [stuːra] and Finnish: Enso [enso]) is a pulp and paper manufacturer headquartered in Helsinki, Finland, with significant operations in four continents. The company was formed by the merger of Swedish mining and forestry products company Stora AB and Finnish forestry products company Enso Oyj in 1998. It has approximately 25,000 employees (2016). For 2014, Stora Enso was ranked fifth in the world by sales, among forest, paper and packaging industry companies. The first share of the company dates back to 1288, and it is claimed that Stora Enso is thus the oldest limited liability company in the world.
|Traded as||Nasdaq Helsinki: STEAV
Nasdaq Helsinki: STERV
|Industry||Paper and packaging|
|Jorma Eloranta (Chairman),
Karl-Henrik Sundström (CEO)
|Products||Packaging board, biomaterials, wood products and paper|
|Revenue||€9.802 billion (2016)|
|€783 million (2016)|
|Profit||€407 million (2016)|
|Total assets||€12.326 billion (end 2016)|
|Total equity||€5.868 billion (end 2016)|
|Owners||Government of Finland (37.4% of voting rights, 27.3% via Solidium and 10.1% via Social Insurance Institution of Finland)
FAM AB (27.3% of voting rights)
Number of employees
Stora Enso was formed by the merger of Swedish mining and forestry products company Stora and Finnish forestry products company Enso Oyj in 1998.
History of StoraEdit
The Swedish copper mining company Stora Kopparberg ("great copper mountain") in Falun was granted a charter from King Magnus IV of Sweden in 1347, although the oldest preserved share in the company (granting the Bishop of Västerås 12.5% ownership) dates from 1288. Some claim this to be the oldest existing corporation or limited liability company in the world.
For some periods during the 17th century, the mine provided two thirds of the world production of copper. In the 18th century, the copper mining gradually decreased in importance, and therefore, in 1731, the company bought its first iron ore mine. By the 1860s, iron ore was economically more important to the company than copper.
Stora Kopparbergs Bergslags AB was incorporated as a modern shareholder company in 1862. Towards the end of the 19th century, it diversified from mining and entered pulp and paper production. In the 1970s, most of the mining and steel mill operations of the company were divested, and the focus changed to forestry-related activities. In 1984, the company name was shortened to Stora AB. The copper mine closed down in 1992.
In 1997, the year before the merger with Enso, Stora had 20,400 employees and a turnover of 44.5 billion SEK. The company owned 2.3 million hectares of forest of which 1.6 million hectares (an area larger than Connecticut) in Sweden and the rest in Canada, Portugal and Brazil. It also produced 7.5 TWh of mostly hydroelectric power.
In 1998, the company merged with Enso to form Stora Enso.
History of EnsoEdit
Enso-Gutzeit Oy was founded in the 19th century in Norway as W. Gutzeit & Co. by Wilhelm Gutzeit; a native of Königsberg, he was a step-cousin of the industrialist Benjamin Wegner and had moved to Norway to work as Wegner's secretary. Gutzeit's son Hans Gutzeit moved the company to Finland, where it became the largest forestry company in the country.
Enso-Gutzeit Osakeyhtiö bought A. Ahlström Osakeyhtiö's forest industries at Varkaus in December 1986. In 1995 a decision was made to merge two state owned forest giants together. The merger materialized next year when Enso-Gutzeit Oy and North Finland based Veitsiluoto Oy formed Enso Oyj.
In 1998, the company merged with Stora to form Stora Enso.
History of Stora EnsoEdit
After the merger, Stora Enso expanded its operations by acquiring wood products businesses and bought paper merchant businesses in Europe. In 2000 the company bought Consolidated Papers in North America. Stora Enso also slowly expanded its operations in South America, Asia and Russia.
In 2000, Stora Enso acquired the North American pulp and paper manufacturer Consolidated Papers for EUR 4.9 billion. The acquisition has, in hindsight, been noted in the financial press as a massive value destroyer. In the same year, Stora Enso and AssiDomän formed a joint company, Billerud AB, to produce packaging paper.
In 2002, Stora Enso started investigating the possibility of establishing plantations and production facilities in Guangxi, China. In the same year, the company was the fifth largest pulp and paper manufacturer in terms of revenue, and in 2005, it was the world's largest pulp and paper manufacturer in terms of production capacity.
In recent years[when?] the company has gone through heavy restructuring. The North American operations were divested in 2007 to NewPage Corporation. Stora Enso has sold and closed down some of its mills in Finland, Sweden and Germany. The closure of a plant in Kemijärvi in 2008 and subsequent events were subject to significant Finnish media coverage.
In 2009, Stora Enso entered into a joint venture in Uruguay, called Montes del Plata, with access to 250,000 hectares of woodland and the intention to build a large-capacity mill. The mill started operating in June 2014.
In September 2012, Stora Enso signed an agreement with Packages Ltd., the largest packaging company of Pakistan, to set up a joint venture named Bulleh Shah Packaging (Pvt.) Ltd. at Kasur, Pakistan.
Between 2006 and 2014, the share of paper products of the total sales has decreased from 62 percent to 38 percent, while packaging and wood products have increased their shares of the revenue, as the company, according to Bloomberg News, is "betting on renewable packaging as online shopping grows." Currently (2015), Stora Enso is investing in biomaterials and renewable construction products as possible future growth areas.
Products and services by divisionEdit
As of 2016, Stora Enso offers products and services through five corporate divisions. The sales figures by division for 2015 were as follows.
|Sales by division 2015, million EUR||External||Internal||Total|
The Consumer board division (previously, before 2015, part of a division called "Renewable packaging") sells varieties of paperboard for packaging of dry and liquid products, including food, as well as for graphic printing purposes.
The Packaging solutions division (previously, before 2015, part of a division called "Renewable packaging") sells corrugated fiberboard, other types of paperboard used in production of packaging containers, as well as complete packaging boxes and equipment and services related to packaging production.
The Paper division (previously, before 2015, called "Printing and reading") sells paper for commercial printing and office use, as well as services for the printing industry, such as paper supply management.
Sales by regionEdit
In 2015, the regional sales distribution was as follows.
|Region||Percent of sales 2015|
Stora Enso has the majority of its operations Europe but also a significant presence in the Americas and Asia. The following table lists the number of employees and the corporate divisions by region.
|Country/region||Employees 2015, excluding joint ventures in Asia||Divisions|
|Finland||6,600||In Europe, all divisions are represented|
|Other European countries||3,900|
|Total for European countries||20,200|
|China||5,100||Consumer board, Packaging solutions, Paper|
The Stora Enso Headquarters in Helsinki was designed 1959-1962 by Alvar Aalto as the head office of Enso-Gutzeit Oy. The building has been in use since 1961. In 2008, Stora Enso sold the building to the German property company Deka Immobilien GmbH for €30 million and started renting the building from WestInvest InterSelect (part of Deka Group), while also declaring its intention to move to other rented premises in the Helsinki area. As of 2016, Stora Enso is still headquartered in the same building.
Stora Enso has a 35 percent stake in the packaging joint venture Bulleh Shah Packaging in Pakistan.
Since 2014, Karl-Henrik Sundström (born 1960) has been the CEO of Stora Enso. Previous CEOs were Jouko Karvinen (from 2007 to 2014) and Jukka Härmälä (from the creation of Stora Enso in 1998 to 2007).
|Name||Year of birth|
|Jorma Eloranta (chairman)||1951|
|Hans Stråberg (vice chairman)||1957|
As of July 2017, the Finnish state is, through the state-owned Solidium fund, the largest owner by number of shares, while the Wallenberg family foundations, through FAM AB, is the second largest. These two owners are also the largest ones by number of votes, controlling approximately equal amounts.
|Largest owners by votes (31 July 2017)||Percent of shares||Percent of votes|
|Social Insurance Institution of Finland||3.3||10.1|
|Varma Mutual Pension Insurance Company||1.3||4.2|
|MP-Bolagen i Vetlanda AB (incl. Stiftelsen Seydlitz Småland)||1||2.2|
|Ilmarinen Mutual Pension Insurance Company||2.4||2.1|
|Erik Johan Ljungberg's Education Foundation||0.5||0.8|
|Swedbank Robur Funds||1.6||0.5|
|Nordea Investment Funds||1||0.3|
|The State Pension Fund (Finland)||1||0.3|
Following the merger, English became the lingua franca of the company. A study of the implications of this for the effectiveness of Stora Enso's internal business communication, published in the academic journal Business Communication Quarterly, concluded that the analyzed communication "seemed to work well".
Accusations of wrongful accountingEdit
The North American part of the group was sold in 2007 to NewPage Corporation with a net loss of about 4.12 billion dollars.[clarification needed] According to a Swedish television documentary, there have been accusations that to cover the loss, the accounting was manipulated, which was revealed in 2010.[clarification needed] The documentary also claims that huge[vague] dividend payments were made illegally and top management was aware of that fact and on purpose manipulated numbers to be able to pay dividends.
Gerard Goodwyn, the company's head of accounting who spoke publicly about the accounting mistake, was fired in 2010.
In 2013, Stora Enso published a report written by independent law firms, which the company had commissioned to investigate the accusations. According to the report, the investigations performed did not find any evidence of illegal acts or wrongful financial reporting, apart from mistakes that had already been communicated and corrected by 2009. The findings of the investigations were also been reported to the Finnish Financial Supervisory Authority, which found no reason to take further action. In articles commenting on the report, the Finnish newspaper Helsingin Sanomat stated that they had been contacted by the source of the accusations in 2010 but that, after attempting to confirm the accusations, they had not considered that there were sufficient grounds for a news story.
Human rights concernsEdit
The Swedish program "Kalla fakta" reported in 2014 that Stora Enso uses child labor in its activities in Pakistan, and that the company has been aware of it since 2012. In response, the company denied that child labor exists directly in the operations of its joint venture partner in Pakistan, but admitted that it was present in its supplier networks. It stated that its partner, Bulleh Shah Packaging, is taking short-term action to remedy the situation in areas where child labor is known to exist, and is also working to mitigate child labour in the long term by addressing its root causes.
In April 2015, Stora Enso entered into a partnership with ILO, with the aims of progressively eliminating child labor from the supply chain in Pakistan and promoting decent work conditions. The experiences in Pakistan have also prompted Stora Enso to appoint an executive vice president for sustatainability to its group leadership team, and to include sustainability managers in its division leadership teams.
Since September 2014, Stora Enso has collaborated with Save the Children around children's rights. The collaboration concerns policies and processes, as well as supply network evaluation in India.
Stora Enso was the main sponsor of the FIS Nordic World Ski Championships 2017 in Lahti. The company provided the games with items made of renewable materials, including two spectator shelters built from cross laminated timber elements, which were subsequently donated to the host city.
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- Asfalttikartelli kohta tuomilla, Talouselämä 9.6.2006 s. 10 (Finland's Talouselämä newspaper)
- Dokument inifrån, Dubbel bokföring, 2013-05-16
- Stora Enso: Accounting mistake was "human error"
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- "Lähde otti yhteyttä Helsingin Sanomiin" [The source contacted Helsingin Sanomat]. Helsingin Sanomat (in Finnish). 8 October 2013. Retrieved 8 December 2015.
- Stora Enso etelän eukalyptusmailla Finnwatch 2009
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