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Assessment Visit to Chikweti, Niassa Report from the Joint Delegation Visit 15-23 October 2013

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Assessment Visit to Chikweti, Niassa Report from the Joint Delegation Visit 15-23 October 2013 report 7. 2014 Assessment visit to Chikweti, Niassa report from the joint delegation visit 15-23 october 2013 Contents Preface 4 1. Introduction 5 2. Findings 7 2.1 Context 7 2.2 The past 8 2.2 The present 12 2.3 The future: Challenges and potential 15 3. Suggestions 23 4. Concluding reflections 26 Annex 1. Additional analysis: FSC and environmental issues 27 Annex 2. Additional analysis of issues relating to agricultural development 31 Annex 3. Terms of reference and members of delegation 33 Annex 4. Programme and people met 35 Annex 5. Excerpts from Chikweti presentation on Compliance & Sustainability 39 3 Preface This report is the result of a visit to Niassa Province input into an on-going reflection on the potential and in October 2013 by a delegation from the Church of challenges of ethical business practices. Sweden and two civil society organisations (CSO) actively involved in development and environmental work in Mo- A number of different perspectives have been represent- zambique. The visit was a joint initiative of the Diocese of ed in the delegation: those of the investor in Chikweti Västerås and the Central Board of the Church of Sweden and the board of GSFF; the leadership of the Diocese within the scope of the Board overseeing the Diocese’s of Västerås; the Church of Sweden at national level; management of donations made to the Church of Sweden. local and international development and environmental CSO:s agricultural development; and advocacy re- The task of the delegation was to achieve a deeper garding the environment and corporate responsibility. understanding of the current situation in Niassa, and more specifically of the investment in the forestry The delegation came to Mozambique and Niassa with company Chikweti via the Global Solidarity Forest Fund widely differing knowledge, perspectives and senti- (GSFF), which has become a matter of great concern from ments about the investment in Chikweti and the role a financial and ethical perspective. The investment has of the Diocese of Västerås. We met a large number been criticised for unethical actions and has failed to meet of different stakeholders – CSOs and researchers the expected financial, environmental and social targets. in Maputo; representatives of local civil society in Niassa; the Chikweti management; local community The Church of Sweden’s financial policy is guided by leaders; a group of women, including one female Christian values, and the interpretation of ‘profit’ is community leader; and government representatives. ultimately related to goals of human development and We accessed the documentation from consultations international environmental and human rights norms that Chikweti had performed with local communities. as well as financial gain. Therefore, acknowledging We heard many stories, asked many questions, and suspicions of unethical actions in the Chikweti invest- had discussions with stakeholders and with our fellow ment and the challenges of reconciling commercial delegates. We listened to discussions between local operations, environmental conservation and community stakeholders and shared our reflections in the group. development in a single initiative – in the words of Bishop Mark Van Koevering of the Diocese of Niassa, Although still very shallow, our understanding of the sit- “in a stool with three legs, each equally important” – uation and its complexities has somewhat deepened. The the Church of Sweden asks itself the following: what broad composition of the delegation helped facilitate our is our role and responsibility as stewards of God’s learning. We rediscovered the obvious: that dialogue and on-going Creation in this particular case, and how can respect is the only way forward. And we could see that faith-related guiding principles such as human dignity, insufficient communication at all levels, from the ground in justice and equality direct us in this critical situation? Niassa to the Church of Sweden, was part of the problem. In the work on this report we have tried to apply these In this report, we make suggestions to the owners, includ- principles. For the members of the delegation represent- ing the Diocese of Västerås, and to other stakeholders. ing the Church of Sweden, this is a way to try to safe- We hope that our analysis and suggestions may also be of guard God’s Creation and the position of humanity. We interest not only to those interested in the operations of also acknowledge our own vulnerability and emphasise Chikweti, but also to those wishing to understand large- the sacred duty towards all that is created. Ultimately, scale land investments in general. we are accountable to God and to the men, women and children who have a relationship with the investment The responsibility for the findings and suggestions in this in Chikweti. For the Church of Sweden, this report report rests with the members of the delegation, not with and the related discussions will constitute an important the organisations we represent. May 2014, Members of the Delegation 4 1. Introduction The task There are many limitations to this study, a few of which The Diocese of Västerås is one of the owners of the we want to emphasise here: the purpose was not to Global Solidarity Forest Fund, GSFF, an investment fund assess or comment on the general impact of large-scale that is the majority owner of the Chikweti forest com- tree plantations of exotic species in Niassa, and past pany. The investment in tree plantations is intended to events and decisions have only been studied indirectly. yield financial returns for the investor and contribute to economic development in the region. However, Chikweti The delegation’s work has not been able to deliver the expected results in terms The delegation consisted of 11 individuals representing of achieving financial, environmental and social goals. the Diocese of Västerås, the national level of the Church Furthermore the project has been the target of sharp criti- of Sweden, We Effect and WWF Sweden. cism by local and international civil society organisations (CSO) and the media. If no other sources are referred to, figures and other fac- tual information on the Chikweti operations have been Following the critique, a public seminar on forest in- obtained directly from the company. Local stakehold- vestments was organised by the Diocese of Västerås ers, including local CSOs ORAM, ROADS UCA and in June 2012, with representatives from the CSOs We UPCN; the Chikweti management; and Bishop Mark Effect and WWF invited as speakers. A general senti- Van Koevering of the Anglican Church have commented ment arising from the seminar was that many of the on a draft version of this report. The final version is, issues that had been criticised have been addressed by however, the sole responsibility of the members of the company following major changes in the manage- the delegation. ment and policies of Chikweti in 2011. As a follow-up to the seminar, it was decided that a joint delegation The group would like to extend their thanks to all those from the Church of Sweden national office and Diocese who shared their time and insights with us, especially the of Västerås should go to Niassa to gain a better under- offices of We Effect in Lichinga and Maputo, whose hard standing of the present situation. The delegation visited work on planning the programme made this trip possible, Maputo and Lichinga (capital city of Niassa Province) and the management of Chikweti, who shared their time from 15–23 October 2013. with us in a very transparent and generous manner. The purpose1 of the trip was to: The representatives of the Church of Sweden would like • make a joint assessment of the impact of the invest- to express particular gratitude to a former represent- ment, including the critical issues that have been ative of We Effect in Lichinga, Kajsa Johansson, who raised; spent her vacation participating in the trip and made an • increase knowledge about the current situation in invaluable contribution to the work of the group. the project area; • relate Chikweti and the development in Niassa Important changes in the company after in general to relevant ethical frameworks (e.g. the delegation’s visit UN Guiding Principles on Business and Human In December 2013 the GSFF board had not been able to Rights, Voluntary Guidelines on the responsible secure long term financing for the plantations at present Governance of Tenure of Land, Fisheries and level. It was therefore decided to reduce the activities Forests in the Context of National Food Security); to a minimal level until funds were secured. About 800 • identify lessons learned and areas for further employees were given notice which would be effectuated development/improvement. end of March 2014. The plan was to have been able 1 For terms of reference and list of participants, see Annex 3. 5 to secure funds before the notices needed to be effectu- a continued and growing forest operation in Niassa ated. However at the end of March a planned merger and thereby a positive general development. Most of with Green Resources was not fully finalized. Since the GSFFs shareholders including PLT and the Diocese of negotiations were well advanced and all parties felt Västerås will for the time being stay as shareholders comfortable that the merger would be completed in the in Green Resources. Green Resources has FSC-certi- near future all 800 employees were offered to stay on fied plantation operations in Tanzania, Uganda and an additional month for the situation to stabilize. Only Mozambique and has a history of 15 years in forest 65 employees chose to stay, however, and by the end plantation in east Africa. of April most employees, including managers, had left the company. As soon as the merger between GSFF and Green Resources was announced, Chikweti started to rehire The first of May 2014 a final agreement between GSFF giving priority to the former employees.
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