Irani Papel e Embalagem S A : Integrated Report 2021

INTEGRATED REPORT (ESG)

2021

Integrated Report Irani 2021 (ESG)	Message from	Our business	Social and relationship	Financial	Human	Intellectual	Manufacturing	Natural	About the	2
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Message from the CEO	GRI (102-14)

Developing the future is what drives us every day. This is the inspiration that guides our way of working and has been shaping the solutions we have offered society for 80 years as one of the main paper and sustainable packaging industrial companies in Brazil, embracing and engaging with the lives of people and the planet.

If we were to delve further into this subject, we'd find that very few Brazilian companies have reached such longevity, a matter of immense pride for us. But longevity is not our sole reason for satisfaction. By fulfilling the dream of the pioneers who settled mid- western Santa Catarina in the early 1940s emersed in a landscape of valleys and mountains, we built an industry linked with nature, one for future generations, which today delivers to society 100% recyclable products manufactured from renewable natural resources. Through integrated production, our own

forest assets and self-generated energy, Irani feels one with nature, fully a part of it.

In line with our relentless endeavor to reach higher levels of transparency and reliability, for the second consecutive year we adopted the principles and methodology of the International Integrated Reporting Council (IIRC). The objective is to present our back story to the various stakeholders of how we are generating value on different fronts - such as governance, economic performance and socio- environmental programs.

Hence, even in the face of continuing challenges arising from the Covid-19 pandemic and reflected in the global economy, we registered important accomplishments throughout 2021. Among them is the recognition of Irani among the Best in Management®, recognition given by the National

Developing the future is what drives us every day. This is the inspiration that guides our way of working and has been shaping the solutions we have offered society for 80 years.

Sérgio Luiz Cotrim Ribas

Chief Executive Officer

transforming people's lives

Integrated Report Irani 2021 (ESG)	Message from	Our business	Social and relationship	Financial	Human	Intellectual	Manufacturing	Natural	About the	3
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Throughout the year, our ongoing concern about the development and well-being of people was combined with the conviction that we must preserve natural resources to ensure the continuity of life.

Quality Foundation (FNQ) to organizations that stand out not only for the quality of management and increased competitiveness, but also for generating value for society through sustainable and constructive actions.

We also won the Transparency Trophy, awarded by the National Association of Executives (ANEFAC) and the Institute of Accounting, Actuarial and Financial Research Foundation (FIPECAFI) of the University of São Paulo (USP). For the first time, we entered the ranking of TOP Open Corps, where 100 Open Startups indicates the leading brands in open innovation with startups in Brazil, entering the TOP 5 Pulp and Paper category. And, among other acknowledgements, for the second year in a row we won the Certificate and the Green Energy Seal - Bioelectricity, from the União da Indústria de Cana-de-Açúcar (Sugarcane Industry Union), for the actions in the Packaging SP unit in Indaiatuba.

At the same time, Irani became the only representative of the packaging segment to be included in the IGPTW B3 portfolio, an index created by the Brazilian stock exchange at the end of 2021 in partnership with the global Great Place to Work® (GPTW) consultancy, a list of companies that invest in the work environment, valuing relationships between

people and the development of employees. Also noteworthy was the mark of 87% in the employee satisfaction index obtained through the GPTW Survey, being recognized yet again as one of the best industrial companies in which to work in Brazil in 2021.

In addition, as part of the extension of benefits guaranteed to workers, we entered the Citizen Company program, which allows the expansion of maternity and paternity leave beyond the periods already guaranteed. Another decisive step was joining the Conscious Capitalism global movement that encourages the adoption of sustainable and humanized management, connecting business with purpose and generating positive impacts for society.

In parallel, for the first time we participated in the Humanized Companies Research project that measures the perception of stakeholders about the human and organizational development of companies, based on concepts such as ethics, diversity, innovation and sustainability. With more than 1,400 respondents, including managers, employees, customers, partners and representatives of society, we reached level A on the list, a stage of maturity higher than that of the market in which we operate. Aside from this, Irani has become a

signatory to the LGBTI+ Business and Rights Forum, fostering efforts to expand the value of diversity not only within the organization, but also throughout society.

In search of enhancing rapprochement with our employees, we launched the "Speak with Sérgio" program: this is a meeting featuring interaction and direct contact of our staff with Irani's CEO, during which important company issues are discussed. In 2021, we ran nine such encounters, with 330 participants.

Throughout the year, our ongoing concern about the development and well-being of people was combined with the conviction that we must preserve natural resources to ensure the continuity of life. Among other achievements, this movement resulted in the increase of carbon credit sales, reaching 155,000 tons, with revenues exceeding R$ 1.7 million. The result strengthens the historical position of Irani, the second paper and pulp industry in the world to obtain carbon credits from the Kyoto Protocol (in 2006). At

the same time, we became signatories of the Sustainable Development Goals (SDGs) Movement in Rio Grande do Sul - in the previous year, we had already adopted this measure in Santa Catarina.

Integrated Report Irani 2021 (ESG)	Message from	Our business	Social and relationship	Financial	Human	Intellectual	Manufacturing	Natural	About the	4
the President	model	capital	capital	capital	capital	capital	capital	report

Another Irani principle is that sustainability cannot exist without innovation, as one is inseparable from the other. These two vectors, interwoven in our activities, come together in initiatives such as Embalei, an online store of recycled packaging for retail, delivery and e-commerce purposes, which we launched in 2021. In addition to promoting environmental preservation, the online marketing of these efficient and innovative products, made from renewable

and biodegradable sources, contributes to social development by boosting the local economy through materials recycling processes.

For Irani, investing in innovation also includes prospecting, selecting and supporting the development and acceleration of startups with high growth potential, which act in synergy with our business model. This support for the projects is through Irani Ventures, a Corporate Venture Capital (CVC) vehicle that we launched in August 2021. In alignment with the Company's innovation strategy, in partnership with Grow+ we also promoted the second edition of Irani Labs throughout the year, a project that seeks to identify innovative and sustainable solutions on behalf of all of society.

Attentive to social causes, in 2021 we launched Brazil's first paper packaging product with antimicrobial technology, which has the property of deactivating viruses, bacteria and fungi, even the Covid-19 virus. In the context of the health crisis that is punishing the planet, we continued the Corrente do Bem (Good Current) campaign, donating R$ 1.2 million in materials and equipment to fight the pandemic.

Also notable was the first Irani Investor Day, organized in 2021. The program aims to bolster our relations with investors, and was held in a completely digital environment, broadcast over the Company's YouTube channel and in which

I had the honor of participating along with our entire team of executives. During the year, we also continued the initiatives that make up the Gaia Platform, seeking to expand Irani's competitiveness and production capacity, as well as the energy sufficiency of its units. For this, we make investments of great positive environmental impact and with an internal rate of return (IRR) higher than the Company's cost of capital.

Closing out our achievements in 2021, we set a number of economic records: our net sales reached R$ 1.6 billion, 56% higher than the previous year; our net profit was R$ 285.3 million, 207% higher than the previous year; and our ROIC (Return on Invested Capital) was one of the highest in the industry worldwide, reaching 24.5% per year and generating superior value for our shareholders.

Management excellence and continuous investments in technology, innovation, and sustainability keep us in step with the desires of society. All this demonstrates that, from a remote village in Santa Catarina's midwest region, extending out to the world over the past eight decades, Irani has become an industrial and economic powerhouse that does not shirk its responsibilities. Our business extends well beyond just manufacturing paper and packaging products; it now translates into the persistent pursuit of sowing relationships and reaping prosperity in favor of the lives of people and the planet. After all, developing the future is what drives us every single day.

Enjoy your reading!

There is no sustainability without innovation, since one is inseparable from the other.

supporting development

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Index

Our business	Intellectual
model	capital

Social and	Manufacturing
relationship	capital
capital	Natural
Financial	capital
capital	About the
Human	report
capital