Stora Enso management severely criticised at shareholders' meeting

Hours spent debating Kemijärvi pulp mill closure

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Opponents of the upcoming closure of Stora Enso's Kemijärvi pulp mill made their presence well known at the company's shareholders' meeting in Helsinki on Wednesday. The lengthy debate and three separate votes stretched the meeting to seven hours.
     The debate did not alter the apparent fate of the pulp mill, which is scheduled to close down at the end of April.
     There were votes on the closing of the accounts, the discharging of the company's board and management from liability for the accounts, and on the composition of the board of directors. Shareholders supporting the movement to preserve the Kemijärvi plant lost in all three votes.
     
The debate was opened by CEO Jouko Karvinen, who held a comprehensive overview of the company's recent past and future prospects.
     Although he mentioned issues such as Russia's wood export tariffs, the sale of factories in North America, the focus of the meeting was on the Kemijärvi pulp mill.
     
According to Karvinen, the future of the Kemijärvi workers is not as dim as it is made out to be.
     The closure of the pulp mill is eliminating 214 jobs, but CEO Karvinen says that only nine of the people affected have not yet found a "solution".
     Laminated beam manufacturer Anaika Group will offer 100 new jobs at a factory it plans to set up at the site of the present pulp mill. Karvinen said that an agreement has been reached on a start-up loan to Anaika.
     Another 35 employees will get jobs at Stora Enso's plants in Kemi and Oulu, and 55 will go the route of retirement or unemployment.
     
Shareholder Yrjö Salokorpi, who had worked at the Kemijärvi plant for 30 years, said that the closure of the factory would be dangerous for environmental reasons. He claimed that the waste water pond at the factory contains many dangerous environmental toxins, which cannot be removed if the factory is closed down.
     He said that the poisons would gradually seep into the nearby Kemijoki River and eventually to the sea.
     Karvinen was not able to comment on the toxic waste issue, and the matter was taken up by Aulis Ansaharju who said that no dioxins or furans were found in samples taken from the water.
     
Shareholders were curious to know why Stora Enso is so enthusiastic about Anaika, which manufactures some of the same products as Stora Enso itself.
     CEO Karvinen said that Anaika is a minor competitor, and is no threat to Stora Enso's success in laminated beam production. He noted that the technology used by Anaika differs from Stora Enso's systems, as it is able to utilise the smaller logs available in Finnish Lapland.
      Jouko Skinnari, a Stora Enso shareholder and Member of Parliament, noted that another laminated beam manufacturer, Versowood, is located in his electoral district. Skinnari said that no more competition in the field is needed.
     Karvinen responded by saying that competitors are not entitled to decide who is allowed in the business and who is not.
     Film director, Stora Enso shareholder, and Kemijärvi activist Kari Väänänen suspected that one aim of the closure is to push wood prices down.
     "If the price of wood falls in the south, cheaper raw material will be brought in from Lapland. In this way, the closure of Kemijärvi will affect all forest owners.
     Väänänen proposed turning the Kemijärvi mill into an large laboratory to test the characteristics of different wood fibres. "I am sure that in ten years shareholders would thank us."
     Väänänen compared the policies of the Stora Enso management to a sailor in a storm who dumps his sails into the sea as excess weight. Karvinen responded by saying that the sails have now been raised, and the course has been set against the wind.
     
Researcher Jakob Donner-Amnell criticised the management of the company for a lack of strategy. "Strategy doctrines taken from other sectors, and high goals of return on investment simply do not work in the forest industry", he said.
      Juha Pikkarainen, leader of the movement in Kemijärvi to preserve the pulp mill, says that the management has cut such a deep wound into people's minds that it cannot be repaired with small bandages.
     Representing the state, which has a significant holding in Stora Enso, Pekka Timonen had praise for the company's management. "The state appreciates the work of the company and its CEO" he said.


Previously in HS International Edition:
  Government denies agreeing to closure of Kemijärvi pulp mill (14.2.2008)
  Protesters in Kemijärvi occupy pulp mill slated for closure (4.1.2008)
  Ruukki Group offers to buy Kemijärvi pulp mill (21.12.2007)
  City of Kemijärvi wants to expropriate pulp mill for resale or lease (19.3.2008)

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