Contributing to Communities Where Sumitomo Forestry Operates

The Sumitomo Forestry Group aims to contribute to sustainable local development through its operations. When starting new businesses or expanding its overseas business sites, the Group's policy is to consider the environment, revitalize local economies and promote employment and thereby operate in harmony with local communities.

Activities in Indonesia

Support for Children Through the KTI Educational Foundation

PT. Kutai Timber Indonesia (KTI) founded the KTI Educational Foundation in 2000 to commemorate its 30th anniversary with the purpose of improving the livelihood of people in Indonesia through education as well as engaging in social activities. This foundation primarily provides educational support to impoverished children as well as school supplies to public schools in Probolinggo in the East Java province where a Sumitomo Forestry Group plant is located. In fiscal 2022, we gave school supplies to the orphaned children, made donations to facilities unable to provide a sufficient number of masks or hand sanitizer, and contributed IDR 103,131,989 (approx. 890,000 yen).

Community Development Through Project EARTH Initiatives

Sumitomo Forestry has also been involved in Project Earth since 2009 to offset CO₂ (approximately 60,000 tons) emitted from the harvesting of wood used for primary building materials of Sumitomo Forestry Homes, and emitted from transport, fabrication, and construction by planting in Indonesia. This project combines "environmental reforestation" for the purpose of recovering the ecosystem of degraded forests in national parks and community-oriented "industrial tree plantations" that unify sustainable comprehensive forest management and community contributions.

Environmental Reforestation to Combat the Harsh Natural Environment and Forest Fires

In Bromo Tengger Semeru National Park located in East Java, Indonesia, Sumitomo Forestry planted about 1.1 million trees, including supplementary planting, over roughly 700 hectares of planted forest between fiscal 2009 to fiscal 2016. Mount Bromo erupted in 2010 at this national park damaging the plantation forest due to volcanic ash and gas. At the end of a severe dry season in November 2014, a large fire broke out and burned almost all of the roughly 400 hectares of forest planted up to 2013. We replanted the forest, constructed a fire belt that was six meters in width and 20 km in total length, prepared water and equipment for fire-fighting, and introduced around the clock dry season patrols. However, in October 2019, a large number of forest fires broke out in the national park and once again damaged approximately 470 hectares of planted forest.

After the afforestation completed in fiscal 2017, we continued to manage the planted forest, and transferred the environmental afforestation site to national park in March 2020 due to expiration of the agreement with the national park for the implementation of the project. Currently, the national park is maintaining and managing the afforestation site and restoring the ecosystem.

Community-oriented Industrial Tree Plantation Side-by-Side the Local People Who Wish to Plant Trees

Starting in the Lumajang Regency located at the foot of Mount Semeru in East Java, Indonesia, Sumitomo Forestry worked with the local people to cultivate about 3,800 hectares of community oriented industrial tree plantation between fiscal 2010 and 2017. The harvest and sell of the grown trees that were planted will stimulate the local economy. KTI, a Sumitomo Forestry Group company, took charge of the local activities promising to purchase future logs to give the local people confidence in their afforestation efforts. Sumitomo Forestry not only engaged in afforestation activity, but also provided local lifestyle infrastructure, building routes necessary for reforestation, and made donations such as academic supplies to kindergartens and elementary schools in addition to setting up public restrooms in villages.

After completing the afforestation efforts in fiscal 2017, the cultivation and reforestation efforts transferred to KTI and participating citizens. Thereafter, the local people involved have been planting trees they themselves cultivated and harvested in addition to seedlings provided for free from KTI. KTI provided the local people with 920,000 seedlings in fiscal 2018, 680,000 seedlings in fiscal 2019, 570,000 seedlings in 2020, 540,000 seedlings in fiscal 2021, and 380,000 seedlings in fiscal 2022. Sumitomo Forestry strives to support the local people who want to plant more trees together with KTI.

66,891 houses were delivered during this project period, which began in 2009, with a roughly 400,000-ton CO₂ fixation target. As of ten years since these afforestation efforts, the cumulative total estimated CO₂ fixation was 430,000 tons*. This is expected to reach our carbon dioxide fixation target of 6 tons per household.

* Excludes CO₂ fixation for environmental reforestation deemed to have a high risk of fires and other disasters

* The estimated CO₂ fixation value is calculated by a prescribed method from the estimated timber volume of plantation forest ten years after planting

Community Contributions Through Social Forestry

As a manufacturer and seller of plywood and processed wood products, KTI contributes to the local economy and community greening through "social forestry" by distributing seedlings to local residents for free to plant on the lands they own, and promising to purchase wood when the trees are mature at its market value.

Respect for Local Tradition and Culture at Overseas Plantations

At forestry business in Indonesia, Sumitomo Forestry also deepens its understanding about the local culture and traditions by engaging in efforts to respect the traditions and cultures of local communities, such as capital support for traditional events held by local residents.

Technical Development for Sustainable Peatland Use

Sumitomo Forestry strives to develop forestry technologies together with the region through large-scale commercial afforestation project in West Kalimantan, Indonesia.

Building Infrastructure and Providing Basic Educational and Medical Support in Neighboring Business Regions

PT. Mayangkara Tanaman Industri (MTI), a large-scale commercial afforestation project in Indonesia, views sustainable development of local communities as a vital managerial challenge, and thereby, undertaking community services that meet the needs of local residents in the areas through education, medicine and hygiene, infrastructure development, agriculture, and livelihood enhancement.

Creation of Employment Opportunities

This forestry business acts as an invaluable employment opportunity for a local community with little industry. In particular, seedling production creates local employment opportunities for women who have few options.

Infrastructure

In fiscal 2018, we began applying the water level management technology we have developed through our projects to flood control in the surrounding communities. We are providing surrounding villages with infrastructure that is easy to maintain and can effectively regulate water levels.

Education, Medical and Sanitation Support

A water purifying plant was setup in villages in business regions to supply safe water for daily use to residents. In addition, Sumitomo Forestry works to provide basic educational support by building local elementary schools and deploying teachers where facilities and instructors are lacking as well as medical support by operating clinics and providing free examinations for neighboring residents.

In fiscal 2020, as masks remained difficult to obtain throughout Indonesia due to the impact of the COVID-19, a mask production and distribution team was established to protect the health and safety of employees, and employees themselves produced cloth masks that can be washed and reused. In addition to distributing the masks to employees, they were also donated to local hospitals and nearby residents.

Total number of local residents using the MTI clinic annually*

*The aggregation period for fiscal 2020 onwards is January to December of each year, and the aggregation period fiscal 2019 is April to March of the following year

Activities in Papua New Guinea

Building Social Infrastructure and Medical Support

Open Bay Timber Ltd. (OBT) in Papua New Guinea has been forestry business forest since 1984 and it contributes greatly to the economic development of the region. In 2007, OBT became a Group company of Sumitomo Forestry to further healthy expansion and effective use of reforestation wood resources.

Clinic Operations

OBT also operates its own clinics and super markets for their employees and local residents to use because the development of social infrastructure is insufficient in Papua New Guinea. In neighboring villages, OBT nurses periodically visit neighboring villages to perform infant health checkups and provide advice to the sick as well as conduct educational activities. Patient transfers to larger hospitals are also provided.

The Open Bay Clinic is staffed day and night by health workers employed by OBT, who provide general medical care, deliveries, and medications, and also receive inpatients and transport critical patients over land and sea to large hospitals. The patients receiving care are not only employees and their families but also many people who travel from far away for treatment.

Response to Coronavirus Disease (COVID-19)

During mass COVID-19 vaccination, which was arranged by OBT, the state health department officials explained the COVID-19 and the vaccine, and those who agreed with the explanation were administered the vaccine. The health department thanked OBT for its strong support of the public-private partnership in the fight against the COVID-19.

Activities in the United States

Social Contribution Activities Through the Housing Business

MainVue Day

MainVue Homes of Sumitomo Forestry Group set up MainVue Day in 2015 as a day each year for employees to participate in volunteer activities. This program both works as an ongoing philanthropic activity and also an opportunity to reflect on a corporate philosophy that focuses on giving back to society.

MainVue Homes employees took advantage of MainVue Day in 2019 to participate in a volunteer effort held by the Low Income Housing Institute (LIHI)—a non-profit offering housing assistance to low-income and homeless people in Washington—to build a group of small homes. There are approximately 40,000 homeless people living in Washington, of which 7,000 are estimated to live with children. LIHI builds small homes equipped with electricity and heat for families living under such conditions. With the hope of providing at least a little more comfort in the lives of these impoverished people, MainVue Home employees pitched in wherever they could from painting both the inside and outside of homes and building front porches to cleaning the housing exteriors.

In 2022, the work was performed at Kent Youth and Family Services, a youth and family charity in Kent, where the MainVue Home exhibition complex is located, and included interior painting of the facility, replacement of some building materials (interior door locks and windows), and housing exteriors cleaning.

Participation in Habitat for Humanity

Crescent of Sumitomo Forestry Group participates in various programs sponsored by Habitat for Humanity, an international non-profit organization (NPO) that provides housing assistance in more than 70 countries around the world.

In 2022, Crescent and a developer active in the Charlotte area collaborated on a project to build a detached house in Charlotte, North Carolina, USA. This project is geared toward low-income families who are unable to afford housing. With contributions from 15 multi-family housing developers, construction began in April2022 with progress monitored. The house was handed over to the new tenants in October.

Sumitomo Forestry Group companies DRB, Edge Homes, and Mark III Properties also donated to Habitat for Humanity and took part in housing support activities.

Participation in Environmental Conservation Efforts

In 2021, Crescent, in collaboration with the Catawba Lands Conservancy, which aims to preserve the land and environment around Charlotte, NC, conducted an invasive species removal and litter pickup activity around the Catawba River. On the day of the activity, Crescent employees removed a total of 2,100 lbs (approx. 950 kg) of trash and participated in the activity to protect native plants and environmental ecology. Crescent will continue to actively implement environmental promotion activities in the future.

Participation in Social Welfare Activities

Crescent is also actively involved in social welfare activities.

In 2022, Crescent employees participated in the Second Harvest Food Bank, a volunteer program that primarily delivers donated food to places of need. Together with companies in and around Charlotte, North Carolina, we packed a total of 16,000 nutrition kits. In addition, we volunteered with a non-profit organization (NPO) to build picnic tables with students at Berryhill public school in Charlotte, North Carolina, USA.

Donations of Wooden Toys by Provisions of Offcuts Produced During Manufacturing

The Canyon Creek Cabinet (CCC), which manufactures and sells wooden cabinets in the United States, contributes to the region by providing offcuts of wood produced in manufacturing products to local charity organizations which donate wooden toys and puzzles to child protection facilities and children's hospitals.

Activities in Australia

In 2022, Henley Properties Group, a company that builds and sells detached houses, sold three houses that were built with the help of a residential land developer and component suppliers, and donated the proceeds. Many people from the company's business partners participated in this activity, from providing land, designing, estimating, manufacturing and procuring materials, managing construction, and building. Specifically, Henley Properties donated to a children's hospital all the earnings from the charity auction of a two-story house in Sunbury, north of Melbourne. Since its inception in 1993, donations through the auction have totaled A$18. 23 million (approximately1,713.6 million yen) , which has been used for medical expenses for children suffering from illnesses.

Activities in New Zealand

Contributions to Local Disaster Prevention and Rescue Efforts

Tasman Pine Forests (TPF) contributes to integrated fire prevention/extinguishing activities in the community in cooperation with Fire and Emergency New Zealand (FENZ), a New Zealand firefighting organization, and neighboring forestry companies. Specifically, TPF contributes firefighting equipment such as fire engines to be operated by the FENZ-led local fire brigade to help prevent and extinguish forest fires in the community.
In addition, TPF employees and logging contractors are working to improve their disaster awareness and capabilities by attending elementary forest fire extinguishing training.

Since fiscal 2017, TPF has been donating activity capital for natural disasters that occur in the region and for leisure accidents as a sponsor to the Nelson Marlborough Rescue Helicopter Trust every year. This trust deployed rescue helicopters 353 times in fiscal 2022. The TPF logo is posted on the Marlborough Rescue helicopter.

Teapot Valley Area Natural Forest Restoration Project Begins

Beginning in 2021, a project to restore natural forests damaged by the Pigeon Valley fire in TPF's mountain forests in February 2019 has begun. Teapot Valley was one of the areas most affected by the fire, and the area contained rare trees and wetlands. The project is part of the New Zealand government's Billion Tree Plantation Project, a government initiative that will last approximately four years. TPF is participating in the project from a financial and operational perspective. In September 2022, we also invited officials from the Ministry of Primary Industries and Tasman District council to participate in reforestation activities.

Activities in Myanmar

Support for Building Monastic Schools

Sumitomo Forestry is involved in the Myanmar Monastic School Support Team and the secretariat, bodies established to support the construction of monastic school-style community schools in Myanmar. Activities which began in 2014 aim to build one monastic-style school every year through donations of companies and individuals who see the benefit. Six schools have been completed to date. At the completion of a school, the donor companies held an opening ceremony with participants from advocating companies and an opportunity to engage with the local children.

The construction has been postponed since fiscal 2021 due to the COVID-19 and other factors. We plan to continue our support in the future as the Myanmar Monastic School Support Team.