Trading in Credibility The myth and reality of the Forest Stewardship Council $ $$ Written and edited by Simon Counsell and Kim Terje Loraas (Rainforest Foundation UK), with case studies contributed by: Anna Fanzeres, Noel Rajesh and Chris Lang, Rama Astraatmaja, Faisal H. Fuad and Longgena Ginting, Nicole Freris and Klemens Laschefski, Jessica Lawrence, Jacinta French, Arbi Valentinus, Carol Yong and Russell Collier. 1 Contents Acronyms used in the text 3 2.5.2 Competition to the FSC, and how to handle it: FSC its own worst enemy? 26 Forward 4 2.5.3 Fast growth and the selection of ‘focus countries’ – in whose interest? 27 Executive Summary, Including Main Conclusions and 2.6 Conclusions to Section 2 29 Recommendations 5 Outline of report 5 3. Serving whose interests? 31 Summary of findings and main recommendations 5 3.1. FSC and the ‘multi-stakeholder’ rationale 31 3.2. ‘Multi-stakeholderism’; the theory and the practice 31 Introduction 8 3.2.1. ‘Stakeholders’ and interests groups, who are they? 32 Reason for, and purpose of, the report 8 3.2.2. The balance of interests – appropriate and democratic? 32 Scope and limitations 9 3.3 Certification bodies 35 Structure and general approach 9 3.3.1 Conflicts of interest 35 3.3.2 Competition for certification business 36 1. Certification; an historical overview - from boycotts to ‘market 3.3.3. Endorsements on the basis of ‘hoped-for mechanism’ to ‘policy’ 11 improvements’: no pre-conditions. 37 1.1 Boycotts and the ITTO’s failure 11 3.3.4. Lack of fatal flaws 38 1.2 FSC’s establishment and the dawn of ‘multi-stakehoderism’ 12 3.3.5 Ignoring policy and structural issues 38 1.3 Waning consumer activism and the rise of 3.3.6 Weakness of certification assessment procedures 39 ‘Trade Networks’; a shift in power relationships 13 3.3.7. Trusting the client; hiring ‘safe’ assessors 39 1.4 Institutionalising FSC as 3.4 The FSC Secretariat‘global public policy’13 40 3.4.1 The interests and role of the secretariat 40 2. FSC’s mission and objectives 15 3.4.2 The Secretariat’s support for ‘fast growth’ 41 2.1 Clear objectives? 15 3.5 Other interests – donors and clients 41 2.2. Accreditation and upholding the P and C’s 16 3.5.1 Donor interests – the case of the 1999 Strategic Plan 41 2.2.1 Legal basis of the arrangement 16 3.5.2 FSC’s ‘clients’ – the interests and role of timber producers 42 2.2.2 Lack of clarity over sanctions 16 3.5.3 The interests and role of the major timber purchasers 43 2.2.3 Quality of FSC’s monitoring and follow-up of certifiers 17 3.5.4 WWF and the ‘Trade Networks’; sustaining 2.2.4 Implementation of the Principles and Criteria 18 the timber industry? 43 2.3 Product labelling – providing a credible guarantee 3.6 Transparency 43 to consumers? 21 3.6.1 Transparency and FSC’s Strategic Planning 44 2.3.1. Percentage-based claims 21 3.6.2 Access to information about certifiers and certifications 44 2.3.2. Chain of Custody flaws 22 3.7 FSC’s complaints procedures 45 2.4. Providing ‘incentives for good forest management’? 22 3.8 Conclusions to Section 3 46 2.4.1 Certifying actual performance, or ‘continuous improvement’22 References to sections 1-3 48 2.4.2 FSC and the alternative approaches to improved forest management 23 Notes to sections 1-3 50 2.5 Fast growth 25 2.5.1 Origins of the fast growth scenario 25 please note: the Contents list for Case Studies is overleaf 2 Case Study Contents 4. CASE STUDIES 53 CASE STUDY 6: CANADA: A COMPARISON OF FSC CASE STUDY 1: THE MAKING AND UNMAKING OF FOREST PROCESSES IN BRITISH COLUMBIA AND ONTARIO 107 CERTIFICATION IN THE BRAZILIAN AMAZON: A STUDY Main issues identified 107 ON THE CERTIFICATION PROCESS OF TWO LOGGING 1. Summary 107 COMPANIES IN THE STATE OF PARÁ. 53 2. Background to the FSC in Canada 107 Main issues identified 53 3. The British Columbia Experience 107 1. Summary 53 4. The Ontario experience 109 2. Introduction 53 5. Conclusions to the case study 112 3. Background 54 4. Compliance with Principles and Criteria 55 CASE STUDY 7: THE IRISH NATIONAL INITIATIVE 5. Conclusion 60 AND CERTIFICATION OF COILLTE TEORANTA 114 References to the case study 61 Main issues identified 114 1. Background to the Irish National initiative and the CASE STUDY 2: FOREST INDUSTRY ORGANISATION, Coillte Teoranta certification: 114 THAILAND 63 2. The Irish National FSC initiative 115 Main issues identified 63 3. The certification of Coillte 116 1. Summary 63 4. Ignoring policy context and efforts at forestry reform 120 2. FIO 63 5 inadequate response from SGS, the FSC Secretariat 3. The certification 65 and FSC Board 121 4. Compliance with the Principles and Criteria 67 6. Conclusions and recommendations 122 5. Conclusions 70 References to the case study 123 References to the case study 71 CASE STUDY 8: MALAYSIA – THE MALAYSIAN TIMBER CASE STUDY 3: THE CERTIFICATION AND CERTIFICATION SCHEME AND THE FSC 124 DE-CERTIFICATION OF PERUM PERHUTANI 72 Main issues identified 124 Main issues identified 72 1. Introduction 124 1. Summary 72 2. The Malaysian Timber Certification Scheme for 2. Background. 72 ‘Sustainable Forest Management’125 3. Background to the certification 73 3. MTCC and the FSC 128 4. Problems with the certification 75 4. Assessing the MTCC-FSC Collaboration and standards 5. Conclusions to the case 84 development process 129 References to the case study 84 5. Concluding Remarks 131 References to the case study 132 CASE STUDY 4: PRECIOUS WOODS AMAZON (PWA) Appendix 1 132 AND GETHAL; CERTIFICATION OF INDUSTRIAL Appendix 2 133 FORESTRY IN THE NATIVE AMAZON RAINFOREST 86 Main issues identified 86 CASE STUDY 9: PT DIAMOND RAYA TIMBER, INDONESIA 136 1. Introduction 86 Main issues identified 136 2. Background 86 1. Summary 136 3. Patterns of logging in the Amazon Region 87 2. Background 136 4. PWA and Gethal – Origins and Certification Process 88 3. The certification of PTDR 137 5. Environmental impacts 89 4. Complaints against the certification 140 6. Social impacts of the certified logging 92 5. Conclusions to the case study 142 7. Illegal activities 95 References to the case study 142 8. Conflicts with FSC Principles and Criteria 96 9. Conclusions 98 ANNEX 1 to PTDR CASE STUDY - References to the case study 98 SGS’s RESPONSES TO COMPLAINTS 143 CASE STUDY 5: FSC CHAIN OF CUSTODY CERTIFICATION: NOTES TO CASE STUDIES 146 DIM LIGHT AT THE END OF THE TUNNEL 100 1. Summary 100 ANNEX 1 to Main Report - The FSCs Principles and Criteria 151 2. Chain of Custody – background 100 3. Problems with FSC Chain of Custody certification 101 4. Conclusions 104 5. Recommendations 105 3 Acronyms used in the text AMAN Aliansi Masyarakat Adat Nusantara, Indigenous IUCN International Union for the Conservation of Nature Peoples Alliance of the Archipelago (Indonesia). KPH Kesatuan Pemangkuan Hutan, Forest / Plantation BRIMOB Brigade Mobil, Special riot police force deployed in Management Area on State land in Java, Indonesia domestic security and defence operations (Indonesia) LEI Lembaga Ekolabel Indonésia, Indonesian CAR Corrective Action Request Ecolabelling Institute C&I Criteria and Indicators MC&I Malaysian Criteria & Indicators C&L Coopers and Lybrand MoU Memorandum of Understanding CFPC Certified Forest Products Council MR Mutual Recognition CITES Convention on International Trade in MTCC Malaysian Timber Certification Council Endangered Species NCO Norwegian Consumer Ombudsman COICA Coordinating Body for Indigenous NGO Non-governmental organisation Organisations of the Amazon NSC National Steering Committee (of the MTCC) DIY ‘Do it Yourself’ (home improvement) NTCC National Timber Certification Council (of Malaysia) EU European Union PEFC Pan-European Forest Certification scheme FCF Fletcher Challenge Forestry PFE Permanent Forest Estate FIO Forest Industry Organisation, Thailand PP Perum Perhutani FMU Forest Management Unit P&C Principles and Criteria FoE Friends of the Earth PTDR PT Diamond Raya FoIE Friends of the Irish Environment PWA Precious Woods Amazonia FPS (Irish) Farm Partnership Scheme RFN Rainforest Foundation Norway FSC Forest Stewardship Council SA Soil Association GTZ German Agency for Technical Cooperation SCS Scientific Certification Systems, Inc. HCVF High conservation value forests SGS Société Générale de Surveillance HPH Hak Pengusahaan Hutan, Natural Forest SPC Strategic Planning Committee Concessions on State Land, in Indonesia SSNC Swedish Society for Nature Conservation IBAMA Instituto Brasileiro do Meio Ambiente e TFT Tropical Forest Trust dos Recursos Naturais Renováveis TNC The Nature Conservancy IFBWW International Federation of Building TWG Technical Working Group and Wood Workers (of the National Steering Committee of the MTCC) IFCI Irish Forest Certification Initiative VOICE Voice of Irish Concern for the Environment IPAAM Instituto de Proteção Ambiental do Amazonas WALHI Wahana Lingkungan Hidup Indonesia, IPAM Instituto de Pesquisa Ambiental da Amazônia Friends of the Earth Indonesia ISA Instituto Socioambiental (Brazil) WFP Western Forest Products (Canada) ITTC International Tropical Timber Council WWF World Wide Fund for Nature ITTO International Tropical Timber Organisation 4 Foreword The Rainforest Foundation which 22 persons, including representatives of indigenous he mission of the Rainforest Foundation is to support groups, universities and social and environmental NGOs Tindigenous peoples and traditional populations of the from 13 different countries, participated. The seminar world’s rainforests in their effort to protect their environ- provided an opportunity to share experiences from various ment and fulfil their rights by assisting them in: parts of the world. The ‘case studies’ presented at the meeting suggested that the difficulties being experienced – Securing and controlling the natural resources from Canada to Brazil, and Ireland to Indonesia – were not necessary for their long term well being and managing just isolated ‘incidents’, but were symptoms of structural these resources in ways which do not harm the environ- problems within the FSC.