Green Financing

In 2022, Klabin made an amendment to the financing agreement linked to the execution of the Puma II Project, totaling USD 800 million. This financing consists of A-Loans and Co-Loans with IDB Invest, IFC, and JICA, as well as B-Loans with commercial banks ("Financing"). The amendment extended the average maturity from 3.1 years to 6.9 years while maintaining the original financing cost. Notably, the cost of the financing is now contingent upon the Company's achievement of sustainability goals. 

Linked biodiversity goal: reintroduce or promote the population increase of 2 extinct or threatened species by December 2025, and 3 species by December 2027, within the ecosystem. 2024 result: 01 specie reintroduced (black-fronted piping guan 
) and 01 specie in population reinforcement (vinaceous-breasted amazon).

If Klabin fails to meet these goals, there will be a potential increase in the financing rate of up to 6.25 basis points (bps), with 3,125 bps applied if the first goal is not met and an additional 3,125 bps if the second goal is not met.

In 2023, Klabin started a Sustainability-Linked prepaid receivables program. This will enable the cost of the program to be reduced by 5 bps. The annual measurements of the waste goal will be integrated into the receivables program, mirroring the measurements already established for the RCF.

Linked waste goal (annual): minimum of 97.5% reuse/recycling of solid waste. 2024 result: 99.35% reused.

2030 Goal: Reduce specific industrial water consumption by 20%.

Sustainability Performance Target (SPT) trigger: Water consumption at or below 3.68 m³ per metric ton of production (16.7% reduction vs. 2018).

(12.5 bps step-up in the SLB coupon if the SPT is not met.)

Rationale: Specific water consumption = (water withdrawn − water returned to the environment) ÷ the Company’s total production.

In 2024, Klabin’s reduction in water consumption remained above the target projected for 2030, at 28.3% below the 2018 baseline. This performance is largely attributed to the stabilization of new operations in Phase II of the Puma II Project, which have shown greater water-use efficiency than previous operations; it was also influenced by a higher volume of water discharged and increased pulp and paper production.

The Ortigueira Unit, which accounts for 51.4% of Klabin S.A.’s total water withdrawal, recorded a significant reduction in consumptive water use over the past year due to improvements implemented under the Puma II Project. Fluctuations are expected in the post-expansion period, as the unit is still stabilizing.

The Packaging and Recycling businesses, which together represent 1.3% of the companywide indicator, saw an increase in water consumption in 2024 due to specific operational changes that led to higher water withdrawal and lower volumes returned, directly contributing to the rise in consumption. Operations—and the indicator—are expected to normalize in the coming years.

Klabin units adopt a range of measures to optimize water use, including monitoring of submeters installed across plant areas; reuse of process water in cooling towers; and reuse of water in cleaning activities and in the dilution of the starch glue used in corrugators.

In addition, the Company invests in rainwater harvesting for non-potable uses, such as garden irrigation (Itajaí Unit), utensil cleaning (Lages Unit), toilets (Angatuba and Lages Units), and use in water treatment processes (Otacílio Costa Unit).

Ongoing operations, as well as those under implementation, will continue to be monitored throughout the year to ensure achievement of the specific water-consumption reduction target set for 2030.

Actions Taken	Water Management Working Group, an internal forum with members from all Klabin businesses, responsible for governance, planning, and implementation of actions for water reduction/reuse and effluent reuse, especially in water-stressed areas. Engagement in watershed committees in regions of significant water use (PR and SC) and in the Goiana region (PE)—an area classified as water-stressed by the WRI Aqueduct tool—with active participation in water-resource plans, including discussions on shared use and charging mechanisms for water use. Participation in the Intermunicipal Consortium for the Piracicaba, Capivari, and Jundiaí River Basins, composed of municipalities and companies, with the goal of restoring water sources in its coverage area (state of São Paulo). Periodic monitoring of the Company’s new projects to identify initiatives with potential water savings. Monitoring is carried out through the Project Dashboard, which provides visibility and control over actions aimed at water efficiency in industrial plants. Implementation of an internal water-pricing mechanism at Klabin’s industrial plants. This value is now factored into the Net Present Value (NPV) of projects with potential water savings, promoting more sustainable decisions aligned with efficient natural-resource management. Monthly critical review of indicators and action plans across all industrial operations, including evaluation of water-use and specific-consumption indicators at each unit, identification of deviations and improvement opportunities, and proposal of corrective and preventive actions.
Future Actions	Execution of actions to increase water reuse and improve processes for water efficiency, prioritizing initiatives in water-stressed areas and/or with high water use. Continuation of quarterly meetings with the Water Management Working Group to monitor projects and manage water-related risks and opportunities, along with monthly critical analyses to track the indicator and define actions to improve results at industrial plants. Development of Klabin’s Water Conservation Plan, with participation from relevant departments and other stakeholders, covering the value chain and considering dependencies, impacts, risks, and opportunities related to this resource.
Challenges	Maintaining water-consumption optimization in light of increased production expected from the Company’s expansion in the coming years.
Connections with other KODS 2030 targets	Goal for territories with initiatives to increase territorial water security. Goal for company-managed forest operations with hydrosolidarity management.

2030 Goal: Zero destination of industrial waste to landfills.

Sustainability Performance Target Trigger: reuse/recycling of solid waste of at least 97.5%

(6.25 bps increase in SLB interest rate if goal is not met)

Rational: goal calculated based on the proportion of solid waste reused, recycled and co-processed compared to the total solid waste generated in operations (in tons).

99.35%, with standout performances from the Otacílio Costa and Monte Alegre units, both reporting annual reuse rates above 99.9%.

Additionally, the Ortigueira Unit achieved particularly positive results, reaching a 99.78% industrial waste recycling and reuse rate over the year. This outcome was once again largely supported by the Waste Processing Center located at the plant, where a significant share of the site’s waste is reused or recycled.

In the packaging segment, a highlight was the Lages Unit in Santa Catarina, which began sending sludge waste for composting and Class I waste for co-processing, increasing its recycling and reuse rate from 86.37% in 2023 to 93.73% in 2024.

Also noteworthy is the Rio Verde Unit, which, since February 2023, has been reusing, recycling and/or co-processing 100% of the industrial solid waste generated in its operations and operated throughout 2024 without sending any industrial waste to landfill.

 

Actions Taken	Consolidation of a co-processing contract for energy recovery from non-recyclable waste at the Otacílio Costa Unit, achieving outstanding performance in industrial solid waste recovery/recycling throughout the year. Educational initiatives also contributed to improved waste separation with a focus on material recycling; Use of dregs from the Monte Alegre and Ortigueira units in Paraná and sludge from the Rio Negro Unit in the production of ceramics, pavers and other construction materials; Start of operations of the sludge drying system for energy recovery at the Ortigueira Unit; Monthly critical reviews conducted to monitor the indicator and define actions to improve results across all industrial plants.
Future Actions	Continuation of the co-processing initiative at the Ortigueira Unit in Paraná, including the pilot development of an alternative destination for producing agricultural inputs using a blend of dregs, grits and lime mud (industrial process residues); Ongoing research and development efforts focused on improving the processing/ reuse/recycling of waste; Testing phase for incorporating sludge from the Goiana Unit’s effluent treatment plant into the production of eco-bricks by the regional ceramics industry; Ongoing studies on the destination of waste generated from the paper recycling process (knots and trimmings) for co-processing, in collaboration with the industrial operations, sustainability, and R&D teams at the recycled paper plants in Goiana, Paulínia (São Paulo) and Piracicaba (São Paulo); > Development of partnerships with companies for blending non-recyclable Class I waste to enable its co-processing at the Correia Pinto Unit in Santa Catarina, as well as the completion of studies on the agricultural use of dregs; Studies on composting and/or co-processing of sludge from the effluent treatment plants at packaging-producing plants, such as Feira de Santana (Bahia), Jundiaí DI and Jundiaí TP (both in São Paulo).
Challenges	Reuse of screening waste (knots) at the recycled paper units: evaluation of ways to reuse or recover this material; Maintaining and continuously developing new business models that enable the absorption of products resulting from waste reuse initiatives.
Connections with other KODS 2030 targets	Goal of ten circular economy benchmarking cases in partnership with clients. Goal of having 100% of priority municipalities with participatory management encouraged.

2030 Goal: reintroduce two species that are proven to be extinct and promote the population reinforcement of four more threatened species.

Sustainability Performance Target Trigger: reintroduction or population reinforcement of at least two species native to the ecosystem.

(6.25 bps increase in SLB interest rate if goal is not met)

 

Progress for the goal: 2/2 species.

 

Position of the goal in the mitigation hierarchy:

 

1. Avoid	2. Minimize	3. Restore	4. Offset ▼

 

Reintroduction of fauna

In 2024, two monitoring campaigns were conducted for the Black-fronted Piping Guan (Aburria jacutinga), assessing its ability to survive, disperse, and form breeding pairs. The initiative continues the species reintroduction work started in 2022, when 30 individuals were released. The batteries of the VHF radio transmitters used to identify and track the animals are nearing end-of-life—an event planned as part of the process. For the next monitoring phases scheduled for 2025, to evaluate the species’ adaptation and dispersal in the forest, the technical team will employ contemporary methods: line-transect surveys, direct observation, playback, camera traps, and citizen science*.

The species was selected for its potential to support forest restoration: it has a large home range—up to 1,000 hectares—and is a strong seed disperser, feeding on at least 46 types of native fruits.

Population reinforcement

In 2024, three individuals of the Vinaceous-breasted Amazon (Amazona vinacea) reached the final stage of the population-reinforcement project in Paraná. They completed all rehabilitation steps, including a new pre-release training. With the issuance of a new permit for the release of threatened species by the Instituto Água e Terra (IAT), the individuals were prepared for reinforcement in the wild.

The Vinaceous-breasted Amazon was chosen because it appears on the list of threatened species in Paraná compiled by IAT during the Cumulative Impact Study (a condition of the Puma II Project).This is another bird that supports forest restoration through seed dispersal — especially of araucarias, themselves a threatened species—and it plays a highly relevant ecological role in the region.

Actions Taken	Monitoring of Black-fronted Piping Guans to track their forest dispersal, feeding, and reproductive behavior; Participation in the Population Management Plan (PMP) workshop for cracids (including Black-fronted Piping Guans and curassows), organized by the Chico Mendes Institute for Biodiversity Conservation; the institute supports conservation efforts for both free-ranging and captive individuals; Release of three Vinaceous-breasted Amazons that reached the final rehabilitation stage. Incorporation of fauna rewilding initiatives as a resilience strategy for conservation programs under Klabin’s new Biodiversity and Ecosystem Services Conservation Plan.
Future Actions	Continued monitoring of Black-fronted Piping Guans using contemporary methods—line-transect surveys, direct observation with playback, and citizen science; Assessment and arrangements to secure additional groups of Black-fronted Piping Guans to ensure project continuity, reinforcing the reintroduced population as needed; Monitoring, via VHF radio telemetry, of rehabilitated Vinaceous-breasted Amazons to track their forest dispersal and assess feeding and reproductive behavior.
Challenges	Assessing the success of the Black-fronted Piping Guan reintroduction and the Vinaceous-breasted Amazon population reinforcement. This includes evaluating the animals’ response to the local ecosystem, which may involve challenges such as failure to adapt or threats like poaching and roadkill. The outcomes will be assessed through analysis of landscape use and subsequent interpretation of the collected data.
Connections with other KODS 2030 targets	Other goals regarding the Biodiversity topic: Donate 1 million seedlings of native trees for the recovery of areas. 100% of wildlife roadkill points with initiatives to reduce accidents. Maintain or increase the number of bird species dependent on high-quality forests; and establish six partnerships or research collaborations annually in the fields of nature conservation and biodiversity studies. Conduct six partnerships/studies per year on nature and biodiversity conservation.