UPM in Uruguay / Interview

BACKROUND:
Finnish paper firm UPM-Kymmene Corporation is taking over the Fray Bentos pulp mill and forest plantations in Uruguay. UPM is the world’s largest magazine paper maker and now it will gain sole ownership of the Fray Bentos eucalyptus pulp mill, which was operated by UPM and Metsaliitto’s joint venture Metsä-Botnia Oy.

UPM Chief Executive Jussi Pesonen has stated that the deal will strengthen UPM’s position in emerging markets and substantially boost its pulp production capacity. At the same time, the company is cutting its pulp output at its home base in Finland.

I interviewed Timo Kekki from public relations point of view. He is Strategy Manager in UPM's Mergers and Acquisitions -department.

INTERVIEW:

1. What were the most essential stakeholder groups UPM had to take into account when acquiring business in Uruguay?
The amount and levels of stakeholder groups are very wide. When considering acquisition all the groups were mapped. In principal stakeholders were divided into three levels: i) internal ii) local iii) international. Internal considers naturally employees of acquired companies but as well labour union, project team and UPM personnel. Local stakeholders are e.g. Uruguayan government, local municipality and their citizens, local suppliers, NGO's like environmental associates etc. International stakeholders covers Finnish government, EU authorities, international NGO's (WWF, Greenpeace...), customers, financial institutions to name few. All in all more than 60 stakeholder groups were identified. Local employees, authorities and Uruguayan government were identified as the most crucial ones.

2. In your opinion, how important positive publicity in Uruguay is for your organization?
'Positive publicity' could be defined as fact based publicity. Naturally it is very important that stakeholders and people in Uruguay will get correct picture of our organization already from the beginning. Therefore open and consistent communication among different stakeholders is very crucial. As a big foreign investor in Uruguay it is important that our company principles, values and code of conduct a transparent not only for our employees but also for other parties involved.

3. How UPM has been promoted in Uruguay? How would you describe the volume of the promotion?
UPM hasn't organized any specific promotion in Uruguay. When the deal was published in the summer, parties (seller and buyer) held together press conference in Uruguay and met local authorities and other stakeholders. In those relations UPM presented its business and management principles, such as commitment to sustainable development. Otherwise UPM has no intention to arrange any kind of public promotion campaign. Best way to earn positive image, is to act accordingly.

4. In your opinion, what kind of brand image does UPM have internationally - not only in Uruguay?
I would say that brand image within our industry (incl. employees, suppliers, customers and e.g. financial institutions) is very reliable. And although company has had to make some difficult decisions, which may have negative impact on image among private persons, the open, fact-based communication has strengthen this reliable image.

5. Stora Enso has had conflicts in Brazil. Do you think that will affect public opinion toward UPM?
This doesn't have any direct impact on UPM. In Uruguay UPM or the predecessor haven't had any conflicts, on the contrary the plant and operation in general has very good image and it is very highly appreciated there. Our challenge is to maintain this good heritage and transfer it under UPM brand. In order to succeed in this task our communication and acts must be carefully planned and executed.


Writer: Katja Ruokamo