International Paper: Global Shift to Sustainable Packaging
International Paper is undertaking a significant transformation to establish itself as a global leader in sustainable packaging.
This evolution is being shaped by personal innovation, commitment to circular economy principles and the strategic acquisition of DS Smith.
As a leading global producer, the company is prioritising eco-friendly fibre-based solutions alongside operational efficiency and forest stewardship.
Digital enhancements are also being utilised to potentially reduce costs and improve overall value for its international customer base.
Restructuring efforts throughout 2024 and 2025 demonstrate how International Paper is moving away from commodity pulp to focus on high-value packaging.
During its May 2025 Investor Day, Andrew Silvernail, CEO of International Paper, discussed the company's targets.
Andrew says: “We’re driving a winning mindset within the company. We are all about sustainable, differentiated packaging.”
He further suggested that the strategy would deliver excellence for the organisation.
Driving sustainable growth in North America
The firm formally announced various strategic changes in June 2025 intended to strengthen its North American operations.
These initiatives focus the company’s sustainable packaging solutions within the region and include several structural shifts.
International Paper is exiting the modelled fibre business and converting its Reno, Nevada facility to support packaging operations.
Furthermore, the company is closing a packaging facility in Marion, Ohio and a recycling facility in Wichita, Kansas.
Additional changes involve selling its containerboard mill and associated recycling plants in Xalapa and Apodaca, Mexico.
According to International Paper, these actions are part of a broader transformation that began in 2024.
These steps are designed to create a more agile provider of packaging solutions, specifically following the acquisition of DS Smith in 2025.
This merger created a leader focused on the North American and Europe, Middle East and Africa (EMEA) regions.
The acquisition, completed in January 2025, was valued at approximately US$7.1bn in an all-stock transaction where DS Smith shareholders owned about 33.7% of the new entity.
International Paper announced that this merger could create significant shareholder value and establish a global leader in sustainable packaging.
Andrew says: “The combination of International Paper and DS Smith will create the world’s leading sustainable packaging company.
"With a differentiated geographic footprint and an unparalleled suite of sustainable packaging products and services, we will accelerate growth, improve profitability and serve our customers even better.”
This shift is part of an 80/20 focus in North America which uses the Pareto Principle.
The business philosophy involves aligning resources to drive value by concentrating on the most profitable 20% of customers and products while streamlining less profitable areas.
By concentrating on these core profitable segments, the company aims to eliminate operational waste and improve the speed of delivery across its primary logistics networks.
Industrial results for the expanded region
In third-quarter earnings reported in November 2025, International Paper highlighted progress on its transformational journey.
At the start of 2025, International Paper and Andrew predicted that US box shipments could be up by 1%.
However, by November, this figure was adjusted to show a potential decrease of as much as 1.5% for the full year due to trade uncertainty.
During the earnings call, Andrew said: “While the markets are challenging, we are controlling our own destiny.
"We control our customer-centric approach, and that focus is working in North America.”
Andrew notes that long-term ambitions remain and that International Paper has the ability to deliver on targets established at Investor Day.
Andrew explains that while a softer market in 2025 and 2026 has delayed progress, the company could deliver US$5bn of Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) in 2027 and accelerate further thereafter.
The company remains confident that its capital allocation strategy will support these ambitious financial goals despite the current economic headwinds.
Investment in renewable energy sources at its major mills is expected to further bolster the bottom line by reducing long-term utility expenditures.
Management continues to monitor global trade policies closely to ensure the supply chain remains resilient against fluctuating international tariffs and shipping costs.
Elevating the local customer experience
Despite various market challenges, International Paper remains focused on the customer experience and hyperlocal sales.
An update to its strategy at the end of 2025 stated that one of its greatest strengths is its footprint, which it describes as one of the most advantaged in the industry.
According to International Paper, the business is hyperlocal because most competition occurs within 250 miles of a customer’s facility.
This requires the company to win in each specific local market.
To achieve this goal, the firm is focusing on high-quality packaging, on-time delivery and rapid response times.
By January 2026, International Paper states that this represents a complete transformation in how it operates, invests and serves its customers.
The company continues to leverage its expanded reach following the DS Smith merger to ensure sustainability remains at the core of its operational model.
This approach ensures the firm remains competitive while meeting the evolving needs of C-suite executives and global supply chains.
New digital tracking tools are being implemented to give local clients real-time visibility into their packaging orders and carbon footprint data.
These technological investments are designed to foster deeper partnerships with regional businesses that require bespoke, eco-friendly logistics solutions.
By decentralising certain decision-making processes, the company empowers local managers to respond more effectively to the specific demands of their immediate market territory.
