The Progroup magazine

DEAR READERS, The fact that Progroup is a family company is an important part of our success. When I took over the role of CEO from my father at the turn of 2022/2023, I was not just taking on responsibility for a healthy company with a bright future, but also for a company that has clear values and goals. Sustainability does not just relate to the environment. Ever since Progroup was founded, it has been an integral part of the company’s strategy and been implemented in practice. It starts with our products and continues through all our with our employees, impossible to imagine the This is a good enough topic of sustainability in production processes. It extends to the way we engage business partners and neighbours at our sites. It’s company evolving to be future-proof without it. reason for us to dedicate this edition of Profil to the all its different facets – and there are many of them. Because in actual fact we do not build individual paper machines, corrugated board plants or waste- to- energy plants – what we build are recycling systems that conserve resources. That is our green circle (page 14). We will continue to rely on our technological leadership. We are promoting this development with numerous projects, such as “Paper for WPA” (page 32). As well as relationships at the business level, family relationships are just as vital to our long-term success. JH Holding provides a fundamental guarantee that Progroup will continue to be managed as a family company. My brother Vinzenz and I are equal partners and complement each other perfectly. With the Professionals Academy, he has developed a concept that raises the relationships we have with our customers and partners – usually also family businesses – to a new level (page 24). In this Profil, you’ll learn more about these and many other topics. I hope you enjoy reading this edition. Maximilian Heindl, CEO 3

46 40 EN THU SI ASM 3.1 Adding value by showing respect A positive corporate culture is key to being successful. ______________________________________ 40 3.2 Sustainability as part of work and daily life A chat with Progroup employees. ________________ 46 3.3 Children ask questions – Maximilian Heindl answers What young people from partner organisations and institutions always wanted to ask the Progroup CEO about sustainability. ______________________________________ 48 2.1 All about family business Professionals Academy takes collaboration between family businesses to a new level. ________________________________ 24 2.2 Strong together Bernhard and Maike Lemmink on a successful partnership based on trust over many years, with great potential for the future. ______________________________________________ 29 2.3 The transparent paper roll How the “Paper for WPA” pilot project delivers even more sustainability and reliability in corrugated board production. ________________________________________________ 32 2.4 Innovative investor and committed neighbour How Progroup develops new sites. ___________________________________________ 34 BE LIEF 5

SUST AINA BIL ITY “ The economy doesn’t operate (...) in a lawless space. To create a sustainable economy, you need policies that provide the crucial framework – at a local and regional, national, European and global level.” Reinhard Schneider, Managing Director, Werner & Mertz GmbH. Extract from his book “The Distraction Trick”. “ I think things can change. We already have some of the tools we need – and as for those we don’t yet have, everything I’ve learned about climate and technology makes me optimistic that we can invent them, deploy them and, if we act fast enough, avoid a climate catastrophe.” Bill Gates, founder of Microsoft Corp. and the Bill & Melinda Gates Foundation. Extract from his book “How To Avoid a Climate Disaster. The Solutions We Have and the Breakthroughs We Need”. 7

ARTI FICIAL INTELLI GENCE AND DIGITI SATION “ There’s no alternative to digital transformation. Visionary companies will carve out new strategic options for themselves – those that don’t adapt will fail.” Jeff Bezos, founder and Executive Chairman of Amazon.com Inc. “ This is a unique moment in time where we do have agency over how AI shapes society. And it goes both ways: Technology shapes us and we shape it. There are also a ton of questions around the impact on soci- ety. And there are a lot of ethical and philosophical questions that we need to consider. And it’s important that we bring in different voices, like philosophers, social scientists, artists and people from the humanities.” Mira Murati, Chief Technology Officer of OpenAI in an interview with Time Magazine on 5 February 2023. 9

82% “More than two thirds of all goods in Germany arrive at their destination BOOST FOR RURAL AREAS 82 per cent of those employed in the paper industry work in rural areas. The paper industry is therefore making a key contribution to boosting Germany’s more remote regions and creating stability and wealth in rural areas, explains the German Paper Industry Association. packaged safely in corrugated board.” Dr. Steffen P. Würth, Chairman of the German Corrugated Board Industry Association (VDW) SECOND WASTE-TO- ENERGY PLANT Progroup is expanding its site in Sandersdorf- Brehna to create an eco-friendly zero-waste site. The company’s second, state-of-the-art waste-to-energy plant is being built right next door to the PM3 paper mill. The official ceremony to mark the laying of the foundation stone for the project took place in June 2023. “ WHEN IT COMES TO PAPER, BOARD, CARD, GLASS, METAL AND PLASTIC AS PACKAGING MATERIALS, THE INDUSTRY HAS MANAGED SINCE 1991 TO SAVE AROUND 23 MILLION TONNES OF MATERIAL BY USING LIGHTER PACKAGING.” Kim Cheng, Managing Director – German Packaging Institute (dvi) RECOGNISED FOR “ZERO WASTE” In spring 2023, Progroup received the coveted award in the “Sustainability Leadership Award 2023” category at the Pulp & Paper International Awards. This award is recognition for Progroup’s high-tech sites, which the company has set up following the rules of an efficient circular economy and a strict “zero-waste” concept. 11 FastmarketsPPI Forest Product Awards 2023Sustainability Leadership Award 2023Progroup AG FastmarketsPPI Forest Product Awards 2023Sustainability Leadership Award 2023Progroup AG

Does Progroup build paper mills? Previously, all stakeholders would have answered yes. “Not any longer,” says Progroup CEO Maximilian Heindl. “We build state-of-the-art recycling sys- tems.” The concept can now no longer just be about a “paper machine”. A machine like this will operate for 50, 60 or even 70 years and is therefore developed with the right sustainability concept focusing on the long term right from the start. For Progroup, it’s about more than just the cycle from corrugated board to recovered paper and containerboard and then back to corrugated board again. Ever since the company started operating its first paper machine in Burg near Magde- burg back in 2001, it has worked consis- tently on delivering a zero-waste and zero-emissions strategy, always with the aim of closing the loops for the water and energy it requires as well. Of course, the company’s main busi- ness is still containerboard and corru- gated board. But every single phase of production is now optimised to ensure it fits into the recycling loop. This starts with recovered paper as the raw material and the way it’s processed. In the case of Progroup’s paper machines, this is done using the drum pulping method. In this method, the fibres are not crushed and so can be recycled up to three times more often and there- fore kept in the loop: around 18 to 25 times instead of 6 to 7 times, as was originally the case. But optimising paper recycling is just one element. It is just as important to close the loops for water and energy. WATER – PRECIOUS RESOURCE USED OPTIMALLY Making paper requires water, a great deal of water in fact. To safeguard access to this valuable resource for production, paper mills always used to be built next to rivers. But nowadays this approach is no longer a guarantee of reliable paper production. This is because water as a resource is becoming Responsibility 15 THERMAL UTILISATION PAPER MILL

w e n a t e e c e r g o n o y s m u T h S e s a n d e s e r g 1, t y h pla e f a e u r s c c d r c B o y p rf- cle is alr ply is t t c h o e s s f ul r e m h n o d e a d a – y t h a e r e. s e a p v olv e r m e: A t t h d w a t e a c e ti m hin r c y m n t a ily t it b u sin s p e, t e in cle B his w a u r w a s in g r e v t e s a e s a p s s t e r m els a t h r e c a rt e ill in d o E is p e r a e n n s e e n e r v e s r o n y in pla t lo x gic e s o u r c c e. al s e t u r r e hir n T h d e c p a p tly b t e o e r m m ein e s. p p w it a n a c o m g c w o g r a olu t e tio rld d nis in t e fi r s h ü tin tt e g it n s t a s fi r s d t. t w t. o t h d p a e p e r P r o I n 2 g r o p r o 0 0 u p I n 2 t o 0 1 - e n p r o d u 1, t h is a d u c tio c tio e fi n . A r s ble t t p o e n h clo a s t e - hin t h y's e cir o hin bin e d e. T w h n , s c ula u s r e clo t ain in s e a d ble feature the very best technology avail- able,” explains Maximilian Heindl. This automatically results in evolutionary advancement. The company took the first step in 2001 when it started producing paper at the PM1 paper mill in Burg. This was the first place where the water cycle was closed. There was also a new approach when it came to energy: This was a period when coal was still frequently being used in eastern Germany. Progroup made the very deliberate decision at the time to use gas, a more eco-friendly fuel. But even back then, Jürgen Heindl also had his eye on other sources of energy. Recovered paper was also an important element. When it is pulped, this pro- duces roughly 10 to 15 per cent of non- paper constituents, mostly plastics. They are thermally utilised, producing valuable energy for paper production. But fibres that can no longer be used for papermaking because they are too short are also collected as sludge. This is valuable biomass that can also be thermally utilised. Biomass already represents around 50 per cent of what Progroup recycles to produce energy, and this is on the rise. Responsibility 17 PAPER MILL

The concept of obtaining energy from closed loops can be referred to as groundbreaking. PM2 was first awar- ded the European Union’s EMAS (Eco- Management and Audit Scheme) certif- icate in 2008. Since then, Progroup has provided transparent information each year about the implementation of its EMAS measures and had them reviewed by an independent body. Every three years, the company undergoes an in-depth recertification audit with an accredited environmental expert. In June 2023, it received this European environmental label for the sixth time. It certifies that, as part of an environ- mental management system, Progroup is reducing its energy consumption, saving precious resources like water, minimising waste and thus making an effective contribution to protecting the environment that far exceeds what is required by law. FULLY CLOSED WATER AND ENERGY CYCLE PM3, which started operating in Sandersdorf-Brehna in 2020, is also EMAS-certified. Progroup goes one step further here: “We combine the Progroup’s products are shining exa m ples of the circular econo m y. R ecovered paper is the only ra w m aterial ever used for the The corrugated board end product is also a recyclable product. This is because at the Sustainable products: end of its life it is processed and reused – Progroup is FS C® -certified at its production sites. The containerboard and corrugated containerboard. board sheets m eet the “FS C® -R ecycled”¹ and “FS C® - Mix”² standards. ¹ F S C-C 106840 ² F S C-C 133251 throughout Europe. successful models of the first two paper machines. The closed water cycle is already in place. Having our own, sus- tainable energy supply is the next logical step for us to make in our circu- lar economy that conserves resources,” says Maximilian Heindl in summaris- ing the philosophy and approach to date. When you quantify it, the volume of savings is significant: In Sanders- dorf-Brehna, this technology allows Progroup to save up to 3.75 million cubic metres of fresh water every year and, once the power plant starts oper- ating there, this promises to deliver a saving of up to 62 million kilowatt hours of natural gas. Construction of this waste-to-energy plant began in March 2023. It is being built right next to the PM3 paper mill in Sandersdorf-Brehna and is expected to start operating at the end of 2025. It will then provide all the steam that the site needs as well as a third of its elec- tricity requirement. And looking ahead, it might also be able to help supply district heat to the region: “We might have the opportunity to supply district heat that we are unable to use because of the pressure rating to local district heating grids.” Maximilian Heindl is confident that in light of the recent discussion about heating there will be a renewed upturn in district heating in the future: “We’re already seeing initial successes in Denmark. They’ve made the switch to district heating and managed to save very large amounts of CO₂.” INNOVATION – CONSISTENT DEVELOPMENT OF THE CIRCULAR ECONOMY What other opportunities will be open to Progroup in the future? There is of course the chance to follow the evolu- tion of technology and invest in even more energy-saving machinery, for example. But Progroup would mainly be relying on developments made by its suppliers. This is a level of depen- dence that the company generally avoids. But with the paper mills, the potential is fairly clear because the Responsibility 19

T h lo e o p big s a r e f m ai is t ully clo M a o u xi m r e r e c y ff o clin rt ilia g s p ria t e t a xi m y n H s p ein r o s t e d u a p w it p r o h m o e n s u s e d . r e t u m e c m t h h n e n olo e r g gie c dl: “I e a f t u a s e n t h e e ully clo s n d , all s e d y e f s t fi o o cie p e r n c y.” a t e h a t r e c y clin g make use of it as a raw material, for example in the chemical industry. “At the end of the day, what this boils down to is carbon capture. Although the processes essentially work, when it comes to the infrastructure overall we’re still at a very early stage.” PROSPECTS – OPENNESS TO NEW APPROACHES Progroup is a key player in an energy- intensive industry. Maximilian Heindl needs to consider lots of different ques- tions: What infrastructure will we need in the future? How do we get to hydro- gen? Where will pipelines and waste disposal facilities be built? Maximilian Heindl says that all initiatives that promise to deliver a further improve- ment to the circular economy and the conservation of resources are care- fully monitored. And where it is possi- ble, these initiatives will also be actively supported. The big aim is to ensure that recycling loops are fully closed. Maximilian Heindl: “If you follow the idea through to its conclusion, what you end up with is a fully closed recycling system that uses appropriate technologies to operate with maximum energy efficiency.” Responsibility 21 CLOSEDLOOPS

PROFESSIONALS ACADEMY TAKES COLLABORATION BETWEEN FAMILY BUSINESSES TO A NEW LEVEL Progroup’s business model is based on close, trusting collaboration between family businesses. The Professionals Academy is now taking this family-to-family approach to a new level. Managing director Vinzenz Heindl has set himself clear goals. When Vinzenz Heindl talks about his work, his great drive and enthusiasm are really palpable. “We want to support family-run businesses in our industry and show them excit- ing ways that they can grow. Ulti- mately, they are the backbone of the European packaging industry and we want them to stay that way,” he says in summing up his ambitious goal. This is why he set up the Professionals Academy (ProAc) in March 2021. It is a platform that gives participants the opportunity to engage at an equal level both on topics in the industry and on the specific aspects of running a family business. The idea behind this was born in the run-up to Christmas in December 2020. As is often the case, the conver- sation between Vinzenz Heindl and his father Jürgen Heindl was about the opportunities and challenges that Progroup has. “As is typical of my father, we started by looking at things from the end viewpoint. And we dis- cussed where we want to be in the future – and what we can do today to get there,” recalls the younger of Heindl's two sons. We kept coming back to the basic question of how we can take the business model of Progroup, which is 95 per cent a family-to-family business, into the future. This is because with the successful generational change in the role of CEO from Jürgen Heindl to his older son Maximilian Heindl, there is agreement that it is neither possible nor desirable to copy the past. What needs to be created is a post-patriarchal structure that is ready to cope with the chal- lenges and opportunities of the future. ATTRACTIVE CONFIGURATION OPTIONS “The longer the conversation went on, the more clearly I realised that my skills are a really good fit for this area and I can make a significant contribu- tion to the big picture for Progroup,” says Vinzenz Heindl. He describes his strengths as being his analytical and structured approach as well as his rhetorical skills and curiosity. Then there is also his deep knowledge of interpersonal relationships and a good instinct for people that he has been able to hone every day in his work as a psychologist and psychotherapist. And ultimately the fact that he has grown up with the Progroup family business from the day he was born is also very helpful. “I know from my own experience what it means to be part of a family of entrepreneurs – and to see a company growing rapidly,” explains Vinzenz Heindl. You learn how to take responsibility for your own family but also for a growing number of employees. FAMILY BUSINESS INTELLIGENCE BASIS POTENTIAL TOPICS Family businesses are consistent drivers of the economy. The primary focus is on achieving success with sound judgement and taking responsibility across the generations. The crossover between the performance of the business with a large amount of family involve- ment, the commitment to be successful and ▪ ▪ ▪ ▪ Strengths and specific features of family businesses Relevance and aspects of family governance Strategy for generational change Planning and managing yet protect assets at the same time can unlock generational change potential and also present challenges. Enthusiasm 25 ALL ABOUT FAMILY BUSINESS

When he is designing the workshops, Vinzenz Heindl benefits from his experience of working as a psychologist. today is that the generations that would potentially be taking over the company know what they would be letting themselves in for, and this is why they often deliberately choose not to take it over. The prospect is simply not attractive enough for them,” says Heindl. The goal is therefore to raise awareness in each of the groups and work to come up with solutions. In the events held last year and this year, this resulted in really good progress being made, according to Vinzenz Heindl. He thinks that this is also down to the format. The in-person events each last a day and a half. They start with a keynote speech by a well- known speaker, followed by smaller break-out groups being formed. They focus on one aspect of a topic affecting their own industry or company and then discuss their findings within the group. “This means we can share every single person’s knowledge and findings with the whole group and raise the level of network intelligence,” reports Vinzenz Heindl. “You could also say that this input adds seasoning to the dish. It’s just that the seasoning on its own is not a dish; the dish only tastes good when you combine all the differ- ent ingredients, herbs and spices.” Meeting together in a relaxed atmo- sphere in the evening also boosts the level of mutual trust and openness. “The concept works really well. Every single one of the participants who Enthusiasm 27

STRONG TO GETH ER PROGROUP AND LEWELL KARTONAGEN: CHRONICLING A PARTNERSHIP OF EQUALS With customer number 16, Lewell Kartonagen has been a trusted partner of Progroup for almost 30 years. The two family businesses have been working successfully side by side at the packaging park in Eisfeld since June 2023. Managing director Bernhard Lemmink and his daughter Maike know that they can rely on their cooperation partner completely at any time. Sometimes in life, a misfortune can be a blessing in disguise. In May 2021, the Lemmink family had to watch as their production facility at the old site literally went up in smoke in a major fire. But two years later, they had cause to celebrate again: The new packaging park at the site to the south of Eiseld, just a stone’s throw from the facility that burnt down, was officially opened in a ceremony attended by around 500 guests. “The Eisfeld II plant is a strategic decision and was not the direct result of the fire,” clarifies Bernhard Lemmink. “The driving force behind it was the trend towards sus- tainability. We’d been planning the FOUNDED IN project for a long time and worked together closely with Jürgen and Maximilian Heindl, with a focus on the future.” GROWTH THROUGH COOPERATION The packaging park is a firm commit- ment to Eisfeld as a location and rein- forces the close cooperation. Progroup has been manufacturing corrugated Enthusiasm 29 1985

NO FUTURE WITHOUT SUSTAINABILITY Maike Lemmink, who is studying pack- aging technology at Stuttgart Media University, has a clear idea of how the packaging industry needs to position itself in the future to remain competi- tive. “Sustainability is the most press- ing issue for the future. My fellow stu- dents and I think that design for recycling is absolutely essential for a circular economy that works.” The 23-year-old speaks with real pas- sion and great knowledge of packaging, but she’s not yet ready to succeed her father in his position in the family business: “I've only just done my bach- elor’s degree and I’m involved in a student consultancy. I want to test myself and try new things.” Her father understands this attitude and wants his daughter to be free to choose her own career path. “The issue of business succession is complicated, there’s no quick solution.” PRODUCTION VOLUME EACH YEAR Lewell focuses on distributing and manufacturing complex die-cut packaging and custom-made packaging. PROFESSIONALS ACADEMY PROVIDES GUIDANCE The Professionals Academy has a key role to play in the identification pro- cess for the family; this is where the different generations can engage with one another. It helps parents get a better understanding of their chil- dren’s approach to work and life – and vice versa. “Gen Z has a very different attitude to work to the one we have,” thinks Lemmink. But this doesn’t mean that the young generation auto- matically has it easier. “Every genera- tion has its own opportunities and challenges. If you’re independent and have responsibility for your own employees, you need to be able to re- adjust and refocus every day because the markets are constantly changing.” What Maike Lemmink likes about the Professionals Academy is the chance to talk to young people who are already working in family businesses. The professional input on the topics of sustainability, family business and leadership is also extremely helpful. “I’m delighted that Maike is involved in the Professionals Academy,” says the family businessman. In particular as the world of business is becoming increasingly global, it’s good if young people can meet each other there because they may then go on to work on big projects together internation- ally in the future. Until there’s a firm succession plan in place at Lewell, he’s happy to carry on running the business for a few more years yet. He’s in his mid-50s and feels fit enough to do so. He has just one wish for the future of his company: “I hope that we can continue to grow successfully alongside Progroup for many years to come.” Enthusiasm 31 47 million m²

equally experienced, long-standing Progroup experts: Process expert Christoph Langhammer, who’s been at the company for 24 years, Marc Knoerr, expert in maintenance with 28 years’ service, and Christian Gasteiger, expert in glue and the wet end. This has cre- ated “Paper for WPA”. Together they have defined four core parameters and their tolerable devia- tions – moisture content, TSO, thick- ness and grammage. In future, this data will also be supplied with each roll and read into the machine’s roll verification system with a barcode via the specially programmed interface. The machine operator can then quickly see from green, yellow and red symbols on a touch display which roll they need to pay closer attention to. “Yellow means I need to keep an eye on this roll,” says Lorenz, “but with red you need to take action.” INNOVATION TO BENEFIT THE ENVIRONMENT AND CUSTOMERS A first look at the monitor doesn’t seem that spectacular: The individual Incredible enthusiasm, innovative ideas and meticulous attention to detail are Tino Lorenz's hallmarks. we produce any rejects”. For instance, if the moisture content is too low, we can add some spray mist, or heat for drying if it’s too high. A higher gram- mage requires more heat and a differ- ent TSO angle can in turn also be set via the moisture content. In extreme cases, there is even time to replace a roll that is waiting to be used if the discrepancies are too great to ensure a certain level of quality. A look at the user interface indicates whether all the quality requirements have been met. add up to several tonnes. The system also benefits customers because it ensures that even more deadlines can be met. “Paper for WPA” was launched at the pilot plant in Plößberg. The rollout to the rest of Progroup’s corrugated sheetfeeder plants is ongoing. The plan is initially for seven more plants to be upgraded, says Lorenz. And he will then deliver lots of training in them. “I’m already really looking forward to this.” This is because he’s certain: “The potential is huge.” THE AIM IS TO ACHIEVE JUST 1.45 PER CENT REJECTS Is it possible to quantify this? The level of rejects has already been reduced by 0.4%, says Lorenz – “this is not solely down to Paper for WPA but it’s cer- tainly helped”. The aim is to achieve just 1.45 per cent rejects. If evaluating all this paper data is so beneficial, would it also make sense to take a closer look at the glue? Tino Lorenz laughs. The glue is of course also on his radar. The “Glue Dashboard” is already being worked on. splicers, which are responsible for auto- matically changing rolls, are each shown with four rolls, the active one, the next one in the unwinder and two more. However, the program has every- thing “under control”, enthuses Lorenz. This is because “it allows us to get ahead of the curve and intervene before This does sound like a real innovation. “And it benefits the environment as well as customers,” says Lorenz. This is because, given that the modern plant in Plößberg in Bavaria’s Upper Palati- nate region processes at least 100,000 tonnes of paper every year, even the smallest marginal improvements soon But first of all the “transparent paper roll” needs to be launched. Lorenz is definitely convinced: “With Paper for WPA, the Glue Dashboard and an expe- rienced team, we’ll be able to minimise our rejects.” And this means we’ll be able to manufacture products even more sustainably and reliably. Enthusiasm 33

HOW PROGROUP DEVELOPS NEW SITES It takes many years to get from the point when Progroup envisions constructing a new plant to when it actually starts operating. And this is a good thing. The location in which a new paper machine or corrugated board plant is set to operate for many decades needs to be chosen carefully. This is why there are many different aspects to finding the right site. Managing a big business is a little bit like steering a supertanker: They both require great vision. Progroup conducts its planning over a rolling period of ten years. The ten-year plan- ning is rooted in the five-year medium- term planning and then the annual planning. The planning phase always starts with the question of when a new production facility is required and for what purpose. “We always need devel- opment planning because without a strategic perspective you’re just work- ing opportunistically,” says Progroup founder and deputy chairman of the Supervisory Board, Jürgen Heindl. FINDING THE RIGHT SITE – A MARATHON RATHER THAN A SPRINT Before production plans can be fleshed out over the medium term, a site needs to be identified. The time frame for doing this is six to ten years. The path to choosing a new site is complex; lots of different factors need to be consid- ered. One of them is freight costs. If logistics and production processes are linked together, they can be reduced significantly. “Freight costs are a con- stant issue – also when it comes to CO₂ emissions. That’s why we give very careful consideration to the design of our mill system from day one,” explains Jürgen Heindl. A key element of this mill system is to link the locations of corrugated board plants to the development of packag- ing parks – every corrugated board site generally has a packaging park project affiliated to it. To answer the question of which strategic customers are con- sidered for which location, “our market and sales know-how plays a very big role”, stresses Heindl. Ultimately, mutual trust is crucial. “When it comes to a packaging park, you have a very, very close bond with the customer,” says Heindl, because in the end the two companies have entered into a business relationship that is intended to last 20 to 25 years. This is where the “family to family” business concept comes in. It creates the foundation of trust with its philos- ophy very much geared to long-term business success. IDENTIFICATION PHASE – DILIGENCE RATHER THAN A QUICK SEARCH If the identified location fits into the integrated “paper to corrugated board” mill system and is close enough to the customer and markets, this region is given the go-ahead. This is then fol- lowed by the identification phase: Where are there opportunities in this region, where are suitable areas of land located? However, Progroup does not take over old plants in order to con- tinue running them, but instead pur- sues a greenfield strategy or the approach of reusing land with sustain- ability in mind. The sites are always developed with the best available tech- nology and the necessary infrastruc- ture. The investments are made for the long term. Each time we ask the ques- tion: What energy infrastructure is in place and what are the prospects for developing it? “Thanks to our green- field policy, we’ve always been able to look at the bigger picture in our philos- ophy and continue to develop our sites,” says Heindl in summarising the strategy that has worked well for more than three decades. But to do this, suitable areas of land need to be found. A corrugated board factory requires around 20 hectares, and a paper mill needs double this amount of space. The company looks for a flat piece of land that provides the energy infrastructure needed for pro- duction – gas, hydrogen, electricity. The Progroup team checks out the trans- port links: Are there rail connections? How far away is the nearest motorway? Enthusiasm 35

IMPLEMENTATION PHASE – BUILDING TRUST RATHER THAN MAXIMISING PROFIT Before any plot of land can be pur- chased, its ownership status must of course be clarified. Here too there are various options that carry a number of risks. The situation is comparatively straightforward if there’s a developed structure where negotiations take place with a town or local council. The same is true if the land in question is farmland that is being sold by a single farmer. But if the area in question belongs to differ- ent municipalities or farmers, the rela- tionship between the different parties involved also plays a big role. New build projects can fail at any time not just because of rivalry between the owners. Heindl is well aware that sometimes the difficulties only come to light at a relatively late stage and this is why he stresses that you always need to be looking at several alterna- tive sites at the same time. “You always need a plan B and really a plan C as well. Otherwise the risk is too big.” But with projects of this magnitude, there are often wider, more fundamental objections from the local community. Progroup tries to minimise these risks at a very early stage. On the one hand, it highlights the sustainable nature of its production and makes it clear that the company is engaged in a state-of-the-art, highly efficient recycling economy. It is actively helping to conserve as many resources as possible and become largely non-dependent on fossil fuels. On the other hand, Progroup pres- ents itself as a family business that thinks long-term. “This includes getting involved personally, visiting the local area. This builds trust. Anyone who is making a decision wants to know who the other party involved is,” says Heindl in describ- ing the company’s commitment and dedication. This includes being involved in the life of the local community. This is why the company is very happy to support the local voluntary fire brigade or football club. “We don’t just turn up as an anonymous developer, as an investor looking to build a logistics centre on a plot of land. We’re going to be here for the next fifty to sixty years. That’s why we state from the outset: We’re a good neighbour.” Enthusiasm 37

“ Culture makes people. People make culture.” In two short sentences, Beate Flamm sums up the essence of any corporate culture: It will be suc- cessful if the employees can identify with it and actively help to shape it. Flamm is an acknowledged communications expert who has advised and supported numer- ous companies in developing their culture. As a member of the Board and Senior Vice President Sustainable Change, her current role involves helping the technology provider ALSO navigate various processes of change through comm- unication. CRITICISM CAN ALSO BE A WAY OF SHOWING RESPECT Looking at the world of work, there is an increas- ing focus on the changing needs of a new gener- ation of employees. More than any generation before it, Generation Z are very keen to find meaningful employment that allows them to have the maximum degree of independence and flexibility. At the same time, they expect their employers to offer good opportunities for devel- opment and career progression as well as an open and transparent culture of communication and feedback. Beate Flamm classifies respect in a very differen- tiated way: “The desire to be respected for the work you’ve done is not a generational question. But the style of management – and therefore implementation – is,” she explains. “Showing respect can be broken down into a very simple rule: Communicate with one another respectfully.” “ If I take the time to give carefully considered feedback, I’m showing the other person that I rate their potential.” – BEATE FLAMM This isn’t just about giving and receiving praise. It’s almost even more important to understand that constructive criticism is also a token of appreciation. “If I take the time to give carefully considered feedback, I’m showing the other person that I rate their potential,” says Flamm. SOFT FACTORS CREATE HARD FACTS The Job Study 2023 also illustrates how important a positive and respectful working environment is, not just for Generation Z. This survey is con- ducted every two years by the auditing firm Ernst & Young. This year, more than half of those surveyed (58 per cent) listed this aspect as a key motivational factor. Just as many valued a good relationship with their colleagues. By contrast, monetary factors such as a high salary (33 per cent) and good performance bonuses (12 per cent) were not the top priority for employees. Belief 41

GOOD FOUNDATIONS FOR FAMILY BUSINESSES At the same time, he very clearly recognises the founder’s importance to the corporate culture as a role model and link between the family and employ- ees. The “principle of the family business” will therefore definitely endure. This applies equally to Progroup’s business relationships and the approach internally. For Maximilian Heindl, it’s all about combining growth with sustainability, productivity with reflection, company with family, discipline with enthusiasm, and leadership with team spirit. He’s very keen to continue leading the company’s employees with a very deliberate focus on the family business. “The reassurance that Progroup is not just some anonymous corporation, but a company that we as a family have a close affiliation with is some- thing that I want the employees to retain.” This is why he places great importance on remaining accessible. As part of what are known as “Board brief- ing tours”, he visits every plant and shift in person so he can see the latest developments for himself at 7-S MODEL FROM MCKINSEY Structure Strategy Systems SHARED VALUES Skills Corp. culture Staff Belief 43 His sights firmly set on the future. The “principle of the family business” is and will remain an important part of the way we show respect to our business partners and employees. The expert emphasises that internal communica- tion, a shared language that unites people, plays a key role in the success of a consistent corporate culture. This starts with specific abbreviations and extends right through to the strategic state- ments made by the CEO. Maximilian Heindl is adamant that the corporate culture will also be developed at Progroup on this basis. However, he doesn’t anticipate radical change. “The generational change at Progroup follows the life’s work of the founder, my father. He was the major influence on the corporate cul- ture over many decades. This is a key fact that needs to be considered and respected,” says the new CEO. He regards his role as being to scruti- nise, develop and adapt it in a smart way. “To remain relevant in the future, I as the successor need to make clear statements.”

develop a positive, authentic culture and enable people to identify with what they’re doing – and this applies both to managers and to employees.” Looking ahead to 2030, Maximilian Heindl wants the same thing as he does today: a vibrant corpo- rate culture that all stakeholders can identify with and embrace and develop every single day. “There’s no end date for the development of our corporate culture. This is what makes it so exciting. It’s an active process that always focuses on the people who work at the company and so actively help to shape the corporate culture. I’m already looking forward to having the oppor- tunity to support and help define this,” says Maximilian Heindl as he looks to the future with optimism. Take responsibility, understand and practise the company’s values every single day – this is what Maximilian Heindl aspires to do himself and he expects the same from all managers at Progroup. “ The corporate culture is an active pro- cess that always focuses on the people who work at the company and so actively help to shape the culture.” – MAXIMILIAN HEINDL Belief 45

RONNY: We set very high standards when it comes to ADEL: I look for the FSC® certificate wherever I go; it’s environmental issues – this is something that unites us across all divisions. The people at Progroup are intrigued probably an affliction of the job! Progroup corrugated board bears the FSC® logo. It is an important seal of by this. We have an incentive to do something to reduce quality that shows our products are produced sustain- our environmental footprint. This is a great thing. In my ably. I constantly pay attention to the carbon footprint of private life, as a father, I’m also trying to teach my kids all products and the amount of energy they consume – about sustainability. It’s vital to embrace the targets in with the clear aim of preserving the environment. both our private and working lives. MADLEN: Yes, I don’t just stop thinking about the envi- What are your hopes for the future? MADLEN: I hope that people’s awareness of sustain- ronment when I’m at home either. I think that having a job ability continues to grow. I want us to achieve our where you champion greater sustainability is only really targets. For me, sustainability is part of my work and my feasible if this is an issue you really care about in daily life, but the topic is still something new for many general. other people. I want to help to change this in a positive way. Social sustainability, equal opportunities for women and men and occupational safety are also issues that interest me. ADEL: Environmental protection is also being taken more seriously around the world – I’m seeing this in my private life and at work. This is a good development. At Progroup we are already at a high level. RONNY: I also want to develop as a person. I’m study- ing for a degree in business management alongside my job. I trained as a wastewater engineer and then studied chemistry. As the head of my department, I’m responsi- ble for five employees and I’m also the water protection officer for the site. I’d like to continue to be part of the solution at the company. I definitely don’t know every- thing yet. This is why I find it rewarding to chat to colleagues from other sites, as I’m doing with you now. ADEL: Yes, it’s vital to chat to other people. I talk a lot to colleagues from other sites. I organise meetings, train colleagues and talk to them constantly about environ- mental issues. Every employee – whether they work on a machine, in a truck or in an office – can put forward their own idea outlining how we can save energy. We’ve created a very large database specifically for this purpose. We discuss these ideas because they offer lots of potential. MADLEN: Do you also have contact with customers directly? ADEL: The Forest Stewardship Council® (FSC®) certifi- cate is always a topic that I talk to customers about. Customers often ask me where our corrugated board originates from. Many contact me directly, other enqui- ries are passed on to me by the sales team. It’s import- ant to explain things and communicate. MADLEN: Exactly. The more often we talk about a topic, the more we raise awareness of its importance. Belief 47

Why do you actually make paper? Robin, Cataleya, Hanja, Olli, Giaan, Lenny, Leo, Yannik and Max, 6 – 9 years old, Sandersdorf Junior Firefighters Whether it’s your parcel in the post, food in the supermarket or car parts like engines, you need packaging to make sure everything arrives at your home or at shops or businesses safely. This packaging is made from paper and corrugated board like Progroup’s. It’s a great thing to do because we know we’re making a product that really benefits everyone. Can฀recycled฀paper฀be฀recycled฀ again?฀How฀many฀times? Etienne, 14 years old, Youth Facility EFZ4you, Wi-Wa-Wunderland e.V. Eisenhüttenstadt Paper fibres can be recycled up to 25 times. Each time the fibres are recycled, they get slightly shorter until ultimately they can no longer bind together to make paper. Can we top up our pocket money by handing over all the magazines we’ve collected to Progroup? Luise and Julius, 5 and 7 years old, SG Union Sandersdorf e.V., Gymnastics division You can, for example, start an initiative to collect paper you’ve used with your classmates or daycare centre. One school that has done this is the Erich Weinert Primary School in Sandersdorf-Brehna. Progroup provides the pupils there with a container once a year. Progroup buys all the used paper that they collect off them and turns it into new paper. What does sustainability mean and what is Progroup doing to be sustainable? Hannes, 7 years old, Offenbach/Queich Youth Fire Brigade Examples of sustainability are when we protect animals and the environment by the way we live, when we make sure we don’t pollute the ground, air or water, and when we don’t waste things. We take this very seriously at Progroup. Our products are made from recovered paper. We purify the water that we need for papermaking and use it again and again. And we generate power from the small number of waste materials that are left over. Belief 49

GESAMTAUFLAGE TOTAL PUBLISHED 5.200 Exemplare 5,200 copies STAND CORRECT AS OF Oktober 2023 October 2023 Alle Rechte vorbehalten All rights reserved Aus Gründen der besseren Lesbarkeit wird To make the text easier to read, the male bei Personenbezeichnungen und form will be used for personal designations personenbezogenen Hauptwörtern die and nouns relating to people. Corresponding männliche Form verwendet. Entsprechende terms fundamentally imply equal treatment Begriffe gelten im Sinne der for all genders. The shortened linguistic form Gleichbehandlung grundsätzlich für alle is for editorial reasons and does not imply Geschlechter. Die verkürzte Sprachform hat any prejudice. nur redaktionelle Gründe und beinhaltet keine Wertung. No part of this work may be reproduced or processed, duplicated Kein Teil dieses Werkes darf in or distributed using electronic or irgendeiner Form ohne schriftliche mechanical systems in any form Genehmigung der Progroup AG without the written permission of reproduziert oder unter Verwendung Progroup AG. elektronischer oder mechanischer Systeme verarbeitet, vervielfältigt oder verbreitet werden. © Progroup AG © Progroup AG BILDNACHWEISE PICTURE CREDITS Annette Jacobs / Cover Annette Jacobs / Cover KI-generierte Bilder aus AI-generated images from Midjourney / S.6–9, S.50 Midjourney / P.6–9, P.50 argum für Handelsblatt / S. 10 argum for Handelsblatt / P. 10 Sven Cichowicz für Progroup / S. 24–28 Sven Cichowicz for Progroup / P. 24–28 Lewell Kartonagen GmbH / S. 29–31 Lewell Kartonagen GmbH / P. 29–31 Tanja Hammel für Progroup / S. 32–33 Tanja Hammel for Progroup / P. 32–33 Beate Flamm / S. 40 Beate Flamm / P. 40 Tanja Hammel für Progroup / S. 42–43 Tanja Hammel for Progroup / P. 42–43 Jens Schlüter für Progroup / S. 44–45 Jens Schlüter for Progroup / P. 44–45 Unsplash Unsplash Geordanna Cordero / S.40–45 Geordanna Cordero / P.40–45 GESTALTUNG UND LAYOUT DESIGN AND LAYOUT design hoch drei GmbH & Co. KG design hoch drei GmbH & Co. KG SATZ TYPESETTING design hoch drei GmbH & Co. KG design hoch drei GmbH & Co. KG LITHOGRAFIE LITHOGRAPHY design hoch drei GmbH & Co. KG design hoch drei GmbH & Co. KG DRUCK PRINTING Blaich Druck GmbH, Straubenhardt Blaich Druck GmbH, Straubenhardt IDEE UND KONZEPT IDEA AND CONCEPT Progroup AG Progroup AG Julia Kluck Julia Kluck Sarah Köhler Sarah Köhler HERAUSGEBER PUBLISHER Progroup AG Progroup AG TEXT TEXT Deutscher Fachverlag GmbH, Deutscher Fachverlag GmbH, dfv Corporate Media dfv Corporate Media REDAKTION EDITORS Progroup AG Progroup AG Deutscher Fachverlag GmbH, Deutscher Fachverlag GmbH, dfv Corporate Media dfv Corporate Media