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Forest Certification Programme Office for Social and
Ecological Standards

D. Burger / J. Hess / B. Lang (Eds.)
Environment Society

Economy

Forest Certification: An innovative instrument in the service of sustainable development?
D. Burger / J. Hess / B. Lang (Eds.)

Forest Certification:
An innovative instrument in the service of
sustainable development?

Deutsche Gesellschaft für
Technische Zusammenarbeit (GTZ) GmbH

Dag-Hammarskjöld-Weg 1-5
Postfach 5180
65726 Eschborn
Tel.: +49 (0)6196 79-0
Fax: +49 (0)6196 79-1115
Internet: http://www.gtz.de

Im Auftrag des:
Programme Office for Social and
Ecological Standards

Forest Certification:
An innovative instrument in the service of
sustainable development?
D. Burger / J. Hess / B. Lang (Eds.)

Eschborn 2005
ISBN: 3-936693-27-7

Published by:
Deutsche Gesellschaft für
Technische Zusammenarbeit (GTZ) GmbH
P.O. Box 5180
65726 Eschborn, Germany
Internet: www.gtz.de
Programme Office for Social and Ecological Standards
Tel.: ++49 (0) 6196 79-1461
Fax.: ++49 (0) 6196 79-6132
E-Mail: forest_certification@gtz.de
Internet: www.gtz.de/social-ecological-standards
Responsible:
Jürgen Hess
Editors:
Dietrich Burger
Jürgen Hess
Barbara Lang
Contact person at Federal Ministry of
Economic Coorperation and Development:
Matthias Reiche, Ref. 312
Tel.: ++49 (0) 1888 535-3756
Layout:
Elisa Martin, OE 6006
Print:
medialogik GmbH, Karlsruhe
Internet: www.medialogik.tv

50%

SGS-COC-1349

Eschborn, Germany 2005
Contents

Contents

Abbreviations and acronyms iii

Introduction and summary

Burger / Lang / Hess Forest certification: taking stock from a development
policy perspective 3

Forest management: a potential pillar of sustainable development

De CAMINO Forest management and development 25

Burger Requirements for sustainable forest management
following the paradigm of sustainable development 61

Standards: pointing and paving the way to sustainable forest management

Elliott From the tropical timber boycott to forest certification 79

Burger Standards: flexible and practical aids to communication 91

Liedeker / Spencer Forest Stewardship Council 103

Gunneberg / Scholz The PEFC Council and sustainable forest
management 113

Hinrichs Lembaga Ekolabel Indonesia - Introduction and
implementation of forest certification in Indonesia 135

Chew / Singh MTCC timber certification scheme 155

Vallejo / Hauselmann Demystifying the jungle of competing certification
schemes 167
Contents

Forest certification: driving force for sustainable development or
counter-productive?

Bressel / Wolf Forest certification as a political regulation concept
in the context of global governance 187

Hess Impacts, obstacles to and risks of forest certification 195

Verissimo / Smeraldi / Azevedo Forest certification in Brazil: advances, innovations
and challenges 207

Burger Forest certification and development cooperation - an
innovative partnership 219

About the authors 233
Abbreviations and acronyms

Abbreviations and acronyms
AB Accreditation Body
ACOFOP Asociación de Comunidades Forestales de Petén
AIFTA Association of Formalin and Thermosetting Adhesives Industries (Member
of MPI)
AMAN Alliance of indigenous People of the Archipelago
APHI Asosiasi Pengusaha Hutan Indonesia
Association of Indonesian Forest Concession Holders (Member of MPI)
APKINDO Indonesian Wood Panel Association (Member of MPI)
ARUPA Volunteers Alliance for Saving the Nature
ASEAN Association of Southeast Asian Nations
ASMINDO Indonesian Furniture Industry and Handicraft Association (Member of
MPI)
ATO African Timber Organisation
BCSD Business Council for Sustainable Development
(later renamed World Business Council for Sustainable Development,
WBCSD)
BMZ Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung
German Federal Ministry for Economic Cooperation and Development
B2B Business-to- Business
BSR Business for Social Responsibility
CAR Corrective Action Request
CB Certification Body
CBD Convention on Biological Diversity
CBFM Community Based Forest Management
CCCC Common Code for the Coffee Community
CEPI Confederation of European Paper Industries
CEN Comité Européen de Normalisation
European Committee for Standardization
CIDA Canadian International Development Agency
CIFOR Center for International Forestry Research
CITES Convention on International Trade in Endangered Species of Wild Fauna
and Flora
CoC Chain of Custody
COMIFAC Commission en charge des forêts d'Afrique Centrale
Commission in charge of forests of Central Africa
CONAP Comisión Nacional de Áreas Protegidas
National Commission on Protected Areas
CPF Collaborative Partnership on Forests
CSA Canadian Standards Association

iii
Abbreviations and acronyms

CSD Commission on Sustainable Development of the United Nations
CSR Corporate Social Responsibility
DC Development Cooperation
DFID Department for International Development
DSM Department of Standards Malaysia
ECO ´92 United Nations Conference on Environment and Development
ECOSOC Economic and Social Council of the United Nations
EEC European Economic Community
EMAS European Eco-Management and Audit Scheme
EMS Environmental Management System
ENGO Environmental Non-governmental Organisation
EPG Empowered Participatory Governance
EU European Union
EUREP Euro-Retailer Produce Working Group
FAO Food and Agriculture Organization of the United Nations
FIAN FoodFirst Informations- und Aktionsnetzwerk
FoodFirst Information and Action Network
FINAS Finnish Accreditation Service
FKD Forum Konsultasi Daerah
Regional Discussion Forum
FLEGT Forest Law Enforcement, Governance and Trade
FM Forest Management
FMU Forest Management Unit
FOE Friends of the Earth
FSC Forest Stewardship Council
G-7 Group of the seven major industrial countries
GAP good agricultural practices
GATT General Agreement on Trade and Tariffs
GFTN Global Forest & Trade Network
GDP Gross Domestic Product
GM genetically modified
GMO genetically modified organism
GTZ Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) GmbH
(German Technical Co-operation)
ha. Hectares
HCVF High Conservation Value Forests
IAF International Accreditation Forum
IAF International Arrangements on Forests

iv
Abbreviations and acronyms

IBAMA Instituto Brasileiro de Meio Ambiente e dos Recursos Naturais
Renováveis
Brasilian Institute for Environment and Renewable Natural Resources
IBLF International Business Leaders Forum
IEC International Electrotechnical Commission
IFC International Finance Corporation
IFF Intergovernmental Forum on Forests
IFIR International Forest Industries Roundtable
IFOAM International Federation of Organic Agriculture Movements
IIED International Institute for Environment and Development
ILO International Labour Organization
IMAFLORA Instituto de Manejo e Certificação Florestal e Agrícola
Institute of Forestry and Agricultural Management and Certification
IMAZON Instituto do Homem e Meio Ambiente da Amazônia
Amazon Institute of People and the Environment
IMF International Monetary Fund
IPF Intergovernmental Panel on Forests
ISA Indonesian Sawmill and Wood Working Association (Member of MPI)
ISEAL International Social and Environmental Accreditation and Labelling
ISO International Organization for Standardization
ITTO International Tropical Timber Organization
IUCN The World Conservation Union
(formerly the International Union for the Conservation of Nature)
JCP Joint Certification Protocol (FSC, LEI Indonesia)
KKS Kelompok Kerja Sertifikasi
(Producer Group in East-Kalimantan)
KpSHK Consortium for Supporting Community-based Forestry Management
System
LATIN The Indonesian Tropical Institute
LEI Lembaga Ekolabel Indonesia
Indonesian Ecolabelling Institute
LTM Legitimacy Thresholds Model
MC&I Malaysian Criteria and Indicators for Forest Management Certification
MC&I(2001) Malaysian Criteria, Indicators, Activities and Standards of Performance for
Forest Management Certification (2001)
MC&I(2002) Malaysian Criteria and Indicators for Forest Management Certification
(2002)
MCPFE Ministerial Conference on the Protection of Forests in Europe
MDG’s Millennium Development Goals
MLA Multilateral Recognition Arrangements
MoF Indonesian Ministry of Forestry

v
Abbreviations and acronyms

MPI Masyarakat Perhutanan Indonesia
(Parent Organization of Indonesian Wood Industry)
MRA Mutual Recognition Agreement
MSC Marine Stewardship Council
MTCC Malaysian Timber Certification Council
NGB National Governing Body
NGO Non-governmental organization
NFP National Forest Programme
NSC National Steering Committee
NSMD Non-State Market Driven
NTCC National Timber Certification Council, Malaysia
(later renamed Malaysian Timber Certification Council, MTCC)
NWFP Non-wood forest products
ODA Official Development Assistance
OECD Organization for Economic Co-operation and Development
PEFC Programme for the Endorsement of Forest Certification schemes
(formerly Pan-European Forest Certification)
PEOLG Pan European Operational Level Guidelines for Sustainable Forest
Management
PERSEPSI Association for Economic and Social Development Studies
PFCA Produtores Florestais Certificados de Amazônia
Amazon Certified Forest Producer Group
PPG7 International Pilot Programme for the Conservation of Tropical Rainforests
in Brazil
PPP Public Private Partnership
PRF Permanent Reserved Forest
PRSP Poverty Reduction Strategy Paper
QACC Questionnaire for Assessing the Comprehensiveness of Forest Certifica-
tion Schemes/Systems
RAN Rainforest Action Network
RAP/COC Requirements and Assessment Procedures for Chain-of-Custody
Certification
SFI Sustainable Forestry Initiative
SFM Sustainable Forest Management
SHK Kaltim Community-based Forestry Management East Kalimantan
SIDA Swedish International Development Cooperation Agency
SKEPHI The Indonesian Network for Forest Conservation
SLIMFs Small and Low Intensity Managed Forests
SME Small and Medium Enterprise
SWEDAC Swedish Board for Accreditation and Conformity Assessment
TBT Technical Barriers to Trade

vi
Abbreviations and acronyms

TC Technical Cooperation
TFAP Tropical Forestry Action Plan
TFD The Forests Dialogue
TFF Tropical Forest Foundation
TFT Tropical Forest Trust
TNC The Nature Conservancy
UK United Kingdom (of Great Britain and Northern Ireland)
UKAS United Kingdom Accreditation Service
UN United Nations
UNCED United Nations Conference on Environment and Development
UNCTAD United Nations Conference on Trade and Development
UNDP United Nations Development Programme
UNECE United Nations Economic Commission for Europe
UNEP United Nations Environment Programme
UNFCCC United Nations Framework Convention on Climate Change
UNFF United Nations Forum on Forests
UNHCR United Nations High Commissioner for Refugees
US United States
USA United States of America
US$ US Dollars
WALHI Friends of the Earth Indonesia
WB World Bank
WBCSD World Business Council for Sustainable Development
(formerly Business Council for Sustainable Development, BCSD)
WCED World Commission on Environment and Development
WTO World Trade Organization
WWF World Wide Fund for Nature (formerly World Wildlife Fund)
YLEI Yayasan Lembaga Ekolabel Indonesia
Foundation Indonesian Ecolabel Institute

vii
Introduction and summary
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

Forest certification: taking stock from a development policy
perspective
Dietrich Burger / Barbara Lang / Jürgen Hess

Concept for taking stock of forest certification from a development policy
perspective

Embedded in a general international trend towards developing market-oriented policy instru-
ments, voluntary initiatives and involvement of non-statal actors in environment policy control
(PATTBERG 2004, CASHORE et al. 2004), forest certification has been in use as an instrument
for 15 years now. In the process it has established itself as one of the most influential market
dynamics in the forestry and wood industry sector, with its overarching goal of promoting
sustainable forest management. NUSSBAUM and SIMULA (2004) note: „Most people working
with forestry could easily list a number of areas where certification has had an impact on the
management of a particular forest, a group of forest-dependent people or a particular forest
products market”.

The instrument is now so broadly applied in the forestry and wood industry sector that it is very
unlikely that it will ever disappear. Although the majority of interest groups involved have real-
ised this, forest certification is still the subject of lively controversy and debate (NUSSBAUM /
SIMULA 2004). These are concerned primarily with the level of standards, the governance and
participative structures of the certification initiatives, the role of governments and the question of
applicability in specific regions (e.g. the tropics) under specific conditions (e.g. with a lack of
government forest supervision) or specific types of businesses (e.g. micro-businesses). The
success of certification is frequently measured purely in terms of the certified area, yet this is
very slow in spreading in the original target region for certification (the tropics and subtropics), in
contrast to the temperate regions.

German development cooperation (DC) has been working on forest certification since 1989. For
example, in its statement on protecting tropical forests to the Commission of Enquiry of the
German Parliament, Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) supported
the development of forest certification (DEUTSCHER BUNDESTAG 1990: 785 et seq.). From
the start the development policy interest has looked beyond the function of a market instrument
and the certified area. Much more than this, DC has the expectation that forest certification will
help to effectively support achievement of the paradigm of sustainable development, because it
holds out the prospect of both incentives and concrete orientation for sustainable forest
management. It might moreover possibly improve the structural conditions for sustainable
development, for example by promoting participation, binding rules and transparency in the
forestry and wood industry sector, and maybe even beyond.

For the editors, the current publication has two goals:
It is an attempt to study whether (and which) development policy expectations of forest
certification are being met. Given the brief nature of the experience available, this can at
best be an intermediate assessment.

3
Concept for taking stock of forest certification

It seeks to promote a more comprehensive view of forest certification as a policy
instrument, in contrast to the narrow view of it as a sectoral market instrument.

The interim balance for forest certification from the point of view of development policy is aimed
primarily at three target groups:
Forest certification experts, with the aim of creating awareness of and supporting them in
considering and developing the instrument not only in technical and commercial terms, but
also in understanding and expanding its development policy dimension.
Development cooperation experts, particularly also those outside the forestry sector, with
the aim of helping them understand the potentials of forest certification as an instrument for
supporting development policy change processes and encouraging them to utilise these.
Persons interested in sustainable development, with the aim of using the example of forest
certification to help them gain insight into the range of points of view which have to be
considered in sustainable development, and into the problems and possibilities of practical
implementation of this paradigm.

The approach in this interim balance cannot restrict itself to statistics for certified areas and
businesses, as these provide very inadequate coverage of the instrument’s change potential
and impact. Equally, an exact survey of demonstrable development policy impacts of forest
certification would pose very serious methodological and financial problems, and given the
number and diversity of existing certification systems would also be most unlikely to produce
generally acceptable results.

Instead, the present publication chose a different approach, under which forest certification is
analysed from various perspectives by authors who are almost all actively working on the
dissemination and further development of the instrument. To give just a brief idea of the differ-
ent backgrounds and interests of the authors, brief résumés are given at the end of the book.
The gain in colour and authenticity of the individual papers is intended to make the whole work
less of a reference manual and more of an aid to readers in forming their own opinions.

To ensure a certain common framework of definitions and issues in spite of the diversity of the
individual contributions, the authors were asked to write on the basis of an earlier publication of
the GTZ Programme Office for Social and Ecological Standards: „Making Sustainable Develop-
ment a Reality: the Role of Social and Ecological Standards“ (BURGER / MAYER 2003).

The individual papers are arranged in four sections:
Introduction: This comprises a single paper in which the editors present the concept for
the book, briefly review the current state of forest development and certification, summarise
the papers of the various authors and draw conclusions from these - in brief, attempt to give
a provisional answer to the question whether forest certification can be described as an
innovative instrument for promoting sustainable development, and how this goal can be
better served.
Forest Management, a potential pillar of sustainable development: Here, two papers
first show the connection between forest management and development, and then go on to

4
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

show which requirements forest management must satisfy to comply with the paradigm of
sustainable development. The aim is to make it easier to place forest certification in the
context of sustainable forest management, and this in turn in the context of sustainable
development, in the hope that this will improve the coherence and integrability of forest
certification with fundamental political issues and discussions, and to counter the risk that
forest certification will be regarded merely as a marginal issue for „green freaks”.
Standards, pointing and paving the way to sustainable forest management: After a
review of the history of the emergence of forest certification and a general survey of the
possible ways of formulating standards and their functions, the most important forest
certification systems from the point of view of development policy present themselves - FSC
(Forest Stewardship Council), PEFC (Programme for the Endorsement of Forest
Certification schemes, formerly Pan-European Forest Certification), LEI (Lembaga Ekolabel
Indonesia, Indonesian Ecolabeling Institute) and MTCC (Malaysian Timber Certification
Council). Finally, the question of how to cope with the growing variety of systems for forest
certification is considered.
Forest certification, driving force for sustainable development or counter-productive:
This last part begins by investigating from a political science perspective whether forest
certification can be an appropriate political regulation concept for supporting sustainable
development. It then presents the important impacts and risks identified to date. This multi-
country review is followed by a report on experiences in Brazil, the country with the world’s
highest annual rate of forest disappearance. The closing section looks at the question of
whether and how forest certification and development cooperation can provide stronger
mutual support in the interests of sustainable development.

The current state of forest development

Trends in forest cover

The Food and Agriculture Organisation of the United Nations (FAO) carries out regular surveys
of forest resources. According to the last published survey (FAO 2001a), forest cover in 2000
totalled 3.9 billion ha, or 30% of the land area. Of this, the tropics accounted for just under half
(47%), with the other zones accounting for the rest, i.e. subtropics (9%), temperate (11%) and
boreal (33%). Plantations accounted for 187 million ha, or 4.8% of forest cover.

5
The current state of forest development

Figure 1: Regional distribution of forest and plantations

Regional distribution of forest area worldwide Regional distribution of forest plantations

North and South
North and Central Oceania America
Central Oceania South America 5% 6% Africa
America 5% America 9% 4%
14% 23%

Europe
17%

Africa
Europe
17%
27%
Asia
Asia 59%
14%

(based on FAO 2001 a)

The trend in forest cover from 1990-2000 is shown in Fig. 2. Forest cover includes both natural
forest and forest plantations. While forest cover in the tropics decreased from 1993 (1945 + 48)
to 1871 (1803 + 68) million ha, it increased outside the tropics from 1970 (1863 + 107) to 1998
(1879 + 119) million ha. This was the result of four processes:
Deforestation resulted in 142 million ha of natural forest being converted to other use in
the tropics, compared with only 4 million ha outside the tropics. Globally, 14.6 million ha of
forest cover was lost to deforestation annually.
By contrast, natural expansion of forest totalled only 10 million ha in the tropics,
compared with 26 million ha outside the tropics.
In the tropics reforestation of former natural forest accounted for 10 million ha, compared
with only 5 million ha outside the tropics.
Afforestation created 8 million ha of forest cover in the tropics at the expense of other land
uses, and 7 million ha outside the tropics.

Comparing the global loss of forest cover due to deforestation of 146 million ha with the
increase in forest cover of 51 million ha due to natural expansion (10+26) and afforestation
(8+7), there was a net loss of forest cover worldwide of 95 million ha, or 9.5 million ha a year.
Without the rounding errors in this rough calculation, global net annual loss of forest cover was
9,391,000 ha.

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Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

Figure 2: Changes in forest cover 1990 - 2000 (million ha)

Tropical areas Non-tropical areas

142
4
Natural forest Natural forest
1990: 1 945 1990: 1 863
2000: 1 803 Other land 2000: 1 879 Other land
use classes use classes
10 1990: 2 819 26 1990: 6 280
10 2000: 2 943 5 2000: 6 252

8 7

Forest plantations Forest plantations
1990: 48 1990: 107
2000: 68 2000: 119

Deforestation Afforestation Reforestation Natural expansion of forest

Source: FAO 2001a

The loss of forest cover varied sharply between regions. According to the FAO (2001b, annex,
table 3) Africa accounted for 56%, South America 39.5%, North and Central America 6.1%,
Oceania 3.9% and Asia 3.9%. With an increase in forest cover of 9.4%, Europe is offsetting the
global loss of forest cover, with the largest increases in Belarus and Russia. Asia’s low share in
global loss of forest cover is due not least to the fact that China is shown as having an annual
increase of 1.8 million ha.

A comparison of annual net loss of forest cover by country (cf. Fig. 3) shows Brazil as account-
ing for one quarter of the total global loss (24.6%), followed by Indonesia (14%). The next high-
est contributors - Sudan (10.2%) and Zambia (9.1%) - are virtually ignored in the global forest
debate. Half (48.8%) of the total global loss of forest cover is accounted for by only three
countries, 86.4% by only ten.

7
The current state of forest development

Figure 3: Country breakdown of annual global loss of forest cover

Others
Argentinia
14% Brasil
3%
24%
Zimbabwe
3%

Nigeria
4%

Myanmar
6%
Indonesia
DR Congo 14%
6%

Mexico
7% Sudan
Zambia
10%
9%

(based on FAO 2001 b, annex, tab 3)

Compared with the period 1980-1990, which is shown as having an annual global net loss of
forest cover of 13 million ha, (FAO 1995, quoted in FAO 2001a), the net annual loss of 9.5
million ha in the 1990s seems to represent a slowdown. However, according to the FAO, this is
due primarily to the higher estimate for the rate of natural forest expansion used in the analysis
of the 1990s. Given this, and the fact that additional study of satellite images of the tropics
shows no significant difference in the deforestation rate for the two ten-year periods, the FAO
concludes that „the global rate of loss of natural forests has remained at approximately the
same level over the past 20 years“ (FAO 2001a).

Trends in forest use

Four trends seem particularly important for the role of the forest in sustainable development:
Growing importance of communal forest management: There is increasing recognition
of land rights and land use rights of indigenous groups and local communities, and at the
same time many countries are also seeing a transfer in responsibility for public sector forest
management from centralised agencies to local communities in the process of
decentralisation. WHITE and MARTIN discovered that the area of forest in local community
ownership and forests managed by local communities doubled in the period 1985-2000.
This trend is particularly marked in the tropics, where at least 246 million ha of forest is
officially owned by indigenous or other communities, and 131 million ha of state forest is
officially managed by local communities. Together, this accounts for 22% of the forest in
developing countries (WHITE / KHARE / MOLNAR 2004). More recent studies suggest that

8
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

this percentage will double again by 2020, so that the importance of local community forest
management will continue to increase sharply (SHERR / WHITE / KAIMOWITZ 2004).
Increasing importance of regulated forest management: A positive trend in global forest
development according to the FAO is the increasing importance of regulated forest
management, both in political debate (measured by the participation of countries in regional
processes to develop criteria and indicators) and in implementation. In industrialised
countries, 89% of forest use is subject to a „formal or informal plan”. In the tropics, initial
estimates based on a very limited number of countries show that around 6% of forests are
managed according to a „formal, nationally approved forest management plan covering a
period of at least five years” (FAO 2001a). This enormous difference is undoubtedly one of
the reasons why large areas of forest could be certified very quickly in the industrialised
countries, compared to the tropics.
Increasing cover of wood demand by plantations: Plantations account for just under 5%
of global forest cover. Half of this area is less than 15 years old. Plantations of fast-growing
eucalyptus clones can - e.g. in Brazil - produce up to 100 m³ a year per hectare (SIMULA /
BURGER 2002), compared with growth of 1-2 m³ a year per hectare in the natural forest.
The FAO expects that future growth in demand for wood will be largely met from plantations
(FAO 2001b).
Increasing globalisation of the markets for forest products: In many countries, two
markets with very different requirements and conditions are being served - national and
international The first mainly deals in firewood and other low-quality wood types and non-
wood products, while the second deals in more valuable types with increasingly rising
quality requirements in terms of both the goods and the delivery conditions. In many
countries, the share of the international market is growing rapidly. While a 1998 survey by
the research institute IMAZON (Instituto do Homem e Meio Ambiente da Amazonia)
showed that only 14% of the wood harvested in the Brazilian Amazon was exported
(SMERALDI / VERISSIMO 1999), this share has increased to 36% according to a 2004
study, also by IMAZON (LENTINI / VERISSIMO / PEREIRA 2005). Requirements and
demand in international markets also influence the national markets. For example, the
growing readiness to buy certified wood on the Brazilian market (SOBRAL et al. 2002) is
undoubtedly also caused by the international market.

Certified forest areas

Forest certification generally is in an advanced state of rapid expansion. In 2002 109 million ha
of forest were certified, representing a fourfold increase in certified area compared to 2000
(ITTO 2002). Currently, 236 million ha of forest are certified worldwide (cf. Fig. 4). This repre-
sents 6% of the global forest cover.

Regionally, however, there are substantial differences. Of the 109 million ha in 2002, 54% were
in North America, 38% in Europe, and only 8% in the regions Asia-Pacific (2%), Latin America
(3%) and Africa (3%) (ITTO 2002). Up to April 2005 the situation has changed in that the Dutch
Keurhout foundation, which had registered areas in Malaysia, Congo and Gabon as certified, is
no longer operating. As a result, the share of Africa in particular has decreased further. The

9
The current state of forest development

predominance of North America and Europe continues to be oppressive. If all systems currently
operating are taken into account, over 90% of all certified areas are located in North America
and Europe. However, CSA (Canadian Standards Association) and SFI (Sustainable Forestry
Initiative) were limited to North America from the start. PEFC, though no longer limited to
Europe, so far has certified areas only in one country outside Europe, in Australia. The
territories of the MTCC and LEI national systems are restricted to their domestic areas. Only
FSC-certified areas can be found in all the regions studied. At FSC, areas in the tropics account
for a significantly larger share than if all systems are considered together. A particularly striking
feature is Latin America’s substantial share. Even at FSC, however, by far the largest shares of
certified areas lie in North America and Europe, which together account for almost 80%.

Figure 4: Global certified forest area (State 04/2005)

Total area: 235.912.632 ha

MTTC
4.741.093 ha
2% LEI
91.767 ha
0%

CSA
69.376.075 ha
PEFC
29%
58.396.291 ha CSA
25% SFI
FSC
PEFC
MTTC
LEI

FSC SFI
53.083.912 ha 50.223.494 ha
23% 21%

Sources: CSA: www.certifiedwood.org (25.04.2005)
SFI: www.afandpa.org (25.04.2005)
PEFC: www.pefc.cz/register/statistics.asp (24.04.2005)
MTCC: www.mtcc.com.my/documents (24.04.2005)
LEI: www.lei.or.id (24.04.2005)
FSC: www.fsc.org (24.04.2005)

10
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

Figure 5: Certified forest areas by region and system

As at 4/2005 Status
2002
CSA SFI PEFC MTCC LEI FSC all all all
m ha % reg systems, systems, % reg
m ha % region
N. America 69.4 50.2 11.5 21.7 131.1 55.6 54
Europe 57.3 30.3 57.0 87.6 37.1 38
Asia/Pacific 1.1 4.7 0.09 2.1 3.9 8.0 3.4 2
L. America 7.3 13.7 7.3 3.1 3
Africa 1.9 3.7 1.9 0.8 3
World 69.4 50.2 58.4 4.7 0.09 53.1 100 235.9 100 100
% system 29.4 21.3 24.8 2.0 0.0 22.5 100

Sources: see Fig. 4, and ITTO (2002)

The predominance of North America and Europe in certified area is, however, not in the least
surprising, given that in the tropics it is mostly necessary to first create organised forest
management and the institutional requirements for certification, whereas in North America and
Europe these are essentially already present. The fact that these requirements for certification
are essentially present does not, however, mean that forest management in North America and
Europe generally already meets the standards for certification. Depending on the system,
certification can have a substantial innovative impact in North America and Europe as well (cf.
WWF 2005).

It is particularly difficult to create the conditions for certification in communal forests. So far, only
very few of these have been certified. According to MOLNAR (2003), all the cases under FSC
worldwide amount to slightly over 50 communal forest management certificates, with an area of
c. 1.1 million ha. In the tropics, Mexico and Guatemala are particularly significant in the field of
certified communal forest management.

The authors’ findings

Ronnie De CAMINO begins his paper with a quote from Westoby: „Forest management is not
about trees, but about people. It is only concerned with trees to the extent that they meet human
needs.” This applies not only to forest management but also, and very particularly, to forest
certification. It can be seen as the motto for the whole book, as all the papers are ultimately
concerned with the question of how forest management and certification can be made to serve
humanity.

De CAMINO, who has been concerned for over 30 years with the relationship between forest
management and development, looks here at the relationship between forest management and
the major challenges in human development, such as poverty, securing peace, securing the
natural basis for life, economic development, and accumulating and preserving social capital

11
The authors’ findings

(the stock of social norms, rules and institutions). He shows that forest management contributes
to meeting all these challenges, and can accordingly become a pillar of sustainable develop-
ment. De CAMINO also lists conditions which must be met for this.

Dietrich Burger shows that forest management as a pillar of sustainable development has to
meet much more extensive claims than those of forest sustainability. He presents the compre-
hensive paradigm of sustainable development in brief, with specific reference to forest
management. Among the requirements for sustainable forest management which he empha-
sises are the ability to network with other actors in sustainable development and the „integrabil-
ity” with current future issues.

The following part, which deals with the development, role and specific forms of standards and
forest certification, begins with a paper by Chris Elliott, one of the co-founders of forest certifi-
cation. He shows how in the context of the „forest crisis” of the 1980s, international attention
became focused on the alarmingly rapid decrease and degradation of the forests, particularly in
response to the pressure of public opinion in the industrialised nations. Inadequate responses
by governments and at best half-hearted commitment to the idea of an intergovernmentally
organised labelling system for tropical wood from sustainable management led to a situation
where nongovernmental organisations (NGOs) and parts of the trade became active and
created the instrument of forest certification. The paper also presents other factors which
contributed to NGOs becoming particularly involved in the approach and institutional establish-
ment of forest certification.

In the next chapter, Dietrich Burger uses the framework of communications theory to present
the role of standards in assisting communication between the wide range of actors in forestry
and the subsequent value chain. He also shows what different functions standards can meet,
and the diversity of possible standards initiatives, where certification can be seen as a specific
type of standards initiative. He reviews the features where standards initiatives can differ, in
terms of both formulation and quality of the standards, their verification of compliance,
accreditation of certifiers, and - particularly - in terms of the strategies for persuading target
groups to reward compliance with the standards. Particular emphasis is laid on „key features”
like legality, legitimacy, participation, usefulness and transparency.

Based on this, the four currently internationally most important forest certification systems are
presented, mainly by those responsible for them: FSC by Heiko Liedeker and Michael
Spencer, PEFC by Ben Gunneberg and Oliver Scholz, MTCC by Chew Lye Teng and
Harnarinder Singh. The chapter on LEI is the only one not written by members of staff of the
certification system. The author, Alexander Hinrichs, supported and advised the process in
Indonesia in an important phase as development cooperation expert in Indonesia. In addition to
technical data on the system, his paper provides insight into the history of its evolution and the
problems and successes that accompany such a process.

The final paper in this part is by Nancy Vallejo and Pierre Hauselmann, and deals with the
question of how to counter the much-lamented proliferation of competing certification systems.
As the analytical instruments for comparing systems presented to date have been unable to
bridge the gap of distrust between the adherents of the individual systems, the authors seek

12
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

inspiration in considering other non-forest certification initiatives. The result is the debunking of
a number of myths which have become accepted as facts almost beyond question in the debate
between the actors in forest certification.

The last part of the book focuses on the question of whether certification is a driver for sustain-
able development, or is instead a constraint or even counterproductive. Nina Bressel and
Klaus Dieter Wolf consider the phenomenon of forest certification from the point of view of
political science. They explain that states and societies explore different strategies to cope with
the globalisation-related problem of reduced ability of nation states to solve problems. As a
multi-stakeholder initiative, certification is an option for bundling the problem-solving resources
of the various actors, and for utilising its high degree of legitimacy to offer a viable governance
concept which transcends borders and levels.

Jürgen Hess contrasts the expectations and concerns for forest certification with the impacts
observed and publicised to date. In this, he distinguishes between impacts at the enterprise, the
sector and transsectoral levels. The paper also explores the barriers facing forest certification at
these various levels.

Practical experiences with forest certification in Brazil is described by Adalberto Verissimo,
Roberto Smeraldi and Tasso Azevedo. At the end of 2004, Brazil ranked fifth in the world in
terms of FSC certified forest area, with 3 million ha. The country is an example of the use of
strategic instruments for disseminating forest certification, such as buyer groups, producer
groups, trade fairs and public relations campaigns. These developments were supported by an
NGO alliance for the use of certified forest products. The paper lists seven areas of activity for
civil society, industry and government, which have to be addressed if certification is to evolve
from a niche product to a market leader in the next five years.

In the final paper, Dietrich Burger investigates the common goals and principles of forest certi-
fication and development cooperation. He concludes that there is high potential for mutual
assistance, which is still largely unexploited.

Conclusion: a helpful instrument with development potential

„Forest crisis” still not solved

The outstanding potential of forest management as a pillar for sustainable development is
known. The commitment to sustainable development by 178 countries, including all the world’s
forest countries, shows clearly what principles need to be followed in utilising forests. Forest
certification, which aims at complying with and rewarding such principles, has had astounding
success in the past 15 years, but has still failed to slow the pace of forest destruction, particu-
larly in the tropics - a sobering balance.

However, it would be premature to conclude from this that forest certification has failed.

13
Conclusion: a helpful instrument with development potential

Managing forests can be compared with a ship which is kept on a particular course by a lot of
effort from many hands. It would be unrealistic to expect that a single instrument - let alone one
which was until recently totally unknown - could change the ship’s course quickly by itself.

An interim balance after only 15 years of forest certification can only answer the questions of
whether the instrument has demonstrated its ability to follow the right direction, and whether and
how the capability of the instrument can be improved.

The instrument has proved helpful

Although there are still only a small number of studies dealing with the impacts of certification,
there is growing evidence that forest certification helps to make more responsible use of
resources in forest management on the lines of sustainable development. Natural resources are
used more economically, and more in the interests of our grandchildren. There is more
promotion for employee health and training. The rights of neighbouring communities are better
protected, and gains are more equitably shared, e.g. through adequate payment. The capital
and other economic resources invested are more efficiently used through improved planning,
avoiding unnecessary losses and increased attention to learning processes in operating
procedures.

From a development policy point of view it is particularly important to emphasise that forest
certification also promotes improved use of social capital, i.e. the stock of rules and standard
behaviour:
legality is promoted (i.e. compliance with formal legislation);
many certification systems require increased compliance with traditional rules and rights;
coherent integration of forest management into the cultural, administrative and political
environment is reviewed critically and possibly improved;
forms of conflict resolution are further developed and practised;
the same applies to forms of participation;
as a result, certification also contributes to reducing the mortgaging of social capital which
lies in the isolation and walling off of the forestry sector and which has become positively
hazardous in some countries. The opening up of the forestry sector to include relevant
actors and to enhance comprehensibility and transparency for society are prerequisites for
forestry’s potential for sustainable use to be fully utilised and acknowledged by society at
large. Opening up the forestry sector to broader groups of the population is, however,
regarded by traditional representatives of the forestry sector as a threat rather than as
support, which is a major reason for their resistance to forest certification.

Possibilities for enhancing the capability of forest certification

Forest certification has proved useful in nudging forest management into a new direction.
Staying with the image of the ship, the instrument is working in the right direction, but it is too
weak. Naturally, certification alone cannot reorient forest management towards sustainability,

14
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

and particularly not in worldwide terms. However, the trivial recognition that certification is not a
panacea should not be seen as a reason to ignore certification completely. Reorienting forest
management requires restraining of the opposing forces of actors not aiming at sustainability,
either through regulatory measures or persuasion, while the forces aiming at sustainability need
to be strengthened and better coordinated. Forest certification itself must also work on
enhancing its capability.

However, the capability of certification can only be measured to a very limited extent in terms of
the certified area, just as the capability of a commercial company is not necessarily expressed
by its sales. In the same way that sales can be relatively easily increased in industry by reduc-
ing quality and price (although this is often at the expense of longer term capability), it is easy to
increase certified area by lowering requirements. However, if done at the expense of the credi-
bility of certification, this poses a serious risk to its future viability. That is why all discussion of
enhancing the capability of certification must focus on its credibility as its most valuable feature.
This is based on three factors:
clear reference to the paradigm of sustainable development, i.e. the paradigm must show
through in all elements and phases of certification;
transparency of participation of those involved in specifying the paradigm for specific
situations (e.g. formulating regional standards);
transparency of objective and technically valid conformity verification.

If any of these were to be diminished in the attempt to enhance the capability of certification, its
overall credibility would suffer.

There are numerous possibilities for boosting the capability of certification which are not
mutually exclusive:
avoiding unnecessary complication
• understandable language
• limitation to regulation which is actually needed
reducing complexity
• stepwise approach
• proof of legality
boosting coherence between participating actors
• state
- regulatory framework
- public sector purchasing
• industry
- investment aimed at sustainability
• civil society
- transparency of civil society organisations
expanding of the range of certification services

15
Conclusion: a helpful instrument with development potential

• certification of management of forest resources outside the forest
• certification of environmental services
• multi-sectoral development policy services.

Avoiding unnecessary complication

The fact that standards and certification procedures often seem complicated is frequently due to
communication problems. Often they use a technical vocabulary which the target groups are
unfamiliar with and find difficult to understand. Eliminating such communicative access barriers
to certification is time-consuming, but not very difficult if the target groups are involved.

Certification can also be unnecessarily complicated if procedures are regulated for which no
regulation is needed. For example, in communal forest management, certain ecological
standards can be ensured through traditional knowledge, working methods or available equip-
ment, even without specific rules. Certain requirements for documentation can be irrelevant or
burdensome for certain types of operation. However, caution is needed when „streamlining”
regulations. For example, safety standards for forest work are not redundant simply because the
work is being done by the forest owners themselves.

Reducing complexity

Sustainable forest management must satisfy a range of ecological, economic and social criteria
(including institutional criteria). Accordingly certification of sustainable forest management is
inevitably extremely complex. However, this complexity can become an obstacle, particularly if
the forest management is at a level still far removed from sustainability. With regard to this
obstacle to certification, current discussion focuses on two approaches in particular:
stepwise approach and
proof of legality.

Stepwise approach: The International Tropical Timber Organisation (ITTO) is currently looking
intensively at this approach. Based on the recognition that the demands of existing standards
are a barrier rather than an incentive for many tropical producers, ITTO commissioned studies
on stepwise approaches to attaining certification (SIMULA et al. 2004; PINTO DE ABREU /
SIMULA 2005). The basic idea here is to identify the differences in a concrete operation
between operating practices and an internationally recognised standard, and then to formulate
an action plan to establish compliance with the standard; the operation’s progress towards
conformity is verified by independent experts (RICHARDS 2004: 10). Based on the studies by
SIMULA et al. (2004) and PINTO DE ABREU and SIMULA (2005) the conceptual framework
was further refined and addressed in a recent workshop sponsored by ITTO (ITTO 2005).

Similar stepwise approaches are already practised by the private sector, e.g. by IKEA and
Home Depot (RICHARDS 2004: 11) and by the Global Forest & Trade Network (GFTN) of the
World Wide Fund for Nature (WWF) (RICHARDS 2004: 13). The national Malaysian certification
system MTCC uses a stepwise approach in developing the certification standards (ITTO 2005).
Overall, the idea of the stepwise approach seems to be consolidating further, and is also

16
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

supported by regional processes such as those of the Association of Southeast Asian Nations
(ASEAN), the Commission in charge of Forests of Central Africa (COMIFAC) and other
international actors such as FAO, United Nations Economic Commission for Europe (UNECE)
and The Forests Dialogue (TFD) (ITTO 2005). Certification systems so far have been relatively
cautious, due to the risks of the stepwise approach in terms of credibility, costs and doubtful
benefits, but seem to be taking an increasingly constructive stance towards it.

Proof of legality: Preventing the trade in illegally produced wood and requiring proof of legality of
origin for all traded wood would be an important step en route to regulated forest management.
A number of interstate initiatives and voluntary private sector codes of practice are currently
looking at this possibility (RICHARDS 2004: 17). This apparently simple approach does, how-
ever, pose difficulties in both concept and implementation.

Legality is not synonymous with sustainability. The Brazilian NGO Amigos da Terra-Amazonia
Brasileira (a member of Friends of the Earth) was the first to point out in the 1990s that 80% of
the wood from the Brazilian Amazon region came from illegal origins, and recently published a
study entitled „Damaging legality” (SMERALDI 2002) showing that 80% of the wood from the
Amazon now meets legal requirements. This is because a simplified approval procedure for
clearing by small farmers under state settlement programmes makes it possible to issue trans-
port approval for twice as much wood as is currently being processed. The black market in
these transport permits easily „legalises” wood from unapproved logging. This means, however,
that forest use is no closer to sustainability. Conversely, it is virtually impossible to meet the
formal conditions for proof of legality for sustainable forest management in communal forest or
on indigenous land.

Legality does not necessarily mean equity. Proof of compliance with national legislation in
advance of necessary legal and institutional reforms can actually further exacerbate existing
injustices. (KAIMOWITZ 2003).

Tracking legal origin along the entire product path, and particularly through the international
trading system is very difficult, not least because of the possibilities of fraud (RICHARDS 2004:
17). Not all certification systems are able to provide credible proof of legal origin (ITTO 2005).

It is too early to say whether the current intensive international debate about proof of legality for
wood will produce results, or what these will be. It seems unlikely that proof of legality will prove
a simple alternative to forest certification. There would seem to be little point in developing the
proof of legality and certification in isolation from each other. It is conceivable that proof of
legality will be formulated as a step towards certification, or that the existing certification
systems will be reviewed and possibly modified to meet the requirements for proof of legality
with reasonable effort.

Boosting coherence between participating actors

Forest certification is a possibility for concrete implementation of the paradigm of sustainable
development. Not the least of the reasons for the dynamic development of forest certification is
that the state, private sector and civil society all participate, even if they have different weights.
This new form of governance - joint formulation of a control instrument - has a high level of

17
Conclusion: a helpful instrument with development potential

credibility and binding status, specifically because of the cooperation between social actors who
have previously been perceived as antagonists (private sector and civil society groups)
(PATTBERG 2004: 3). This assumes that each of the actors involved takes seriously the princi-
ples implemented in forest certification as they apply to the actor's own areas of influence, and
works towards their implementation - i.e. actors display coherent behaviour in their various
spheres of activity. Increasing coherence among the actors involved results in the development
of forest certification reflecting positively on the actors, generating a multiplier effect. Given
coherent behaviour by the actors, implementation of the principles of sustainability in the
framework of certification can result in an accelerating process of improving the conditions for
certification and for sustainable development.

Each of the groups of actors involved - state, private sector, civil society organisations - can
promote certification and sustainable development simultaneously in numerous areas, outside
their direct involvement in shaping certification. Here are just a few examples of outstanding
areas:

Regulatory environment: In its sovereign function the state can act to ensure that the legal, tax
and economic environments for the forestry sector comply as closely as possible with the
principles on which certification is based. This could be done e.g. by harmonising forestry law
provisions with specifications for certification, by having state controls take account of certifica-
tion controls, and by rewarding certification in tax assessments and fees, granting use permits
and credits. In this way certification would act not only as a market instrument, but also as a
„soft policy instrument”, avoiding unnecessary double burdens and harmonising the relationship
between national policy and certification. SEGURA (2004: 17-22) lists a range of possibilities for
national governments to take certification into account in shaping the regulatory environment.

Public sector procurement: Besides its sovereign function, the state also often appears in the
function of a commercial enterprise. Public procurement can and should be configured to be
coherent with the policy guidelines for legality and sustainability.

Investment aimed at sustainability: Banks increasingly are making loans conditional on proof of
origin and certification. The World Bank, for example, provides investment specifically for
enterprises satisfying the requirements for independent certification, or presenting action plans
for specific periods to achieve compliance with recognised certification standards (ITTO 2005).
According to RICHARDS (2004), 17 investment banks - including CITIGROUP and ABN-AMRO
- have agreed the „Equator Principles” for assessing and managing the social and environ-
mentally relevant risks of project financing (http://www.equator-principles.com). These banks
are committed to the standards of the International Finance Corporation (IFC) for examining the
social and environmentally relevant impacts of projects. The Dutch ABN-AMRO has imple-
mented a detailed risk policy for forest management and plantations. Forest certification can be
promoted as a viable investment and also support other investment aimed at sustainability by
providing a guiding example of the application of social, ecological and economic standards.

Transparency of civil society organisations: NGOs often press for greater transparency, e.g. in
decision making processes and flows of goods in the forestry sector. However, they frequently
encounter a certain resistance from state and the industry, because actors there do not feel

18
Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

they have enough information about the NGOs’ goals, decision-making procedures and funding.
More transparency on the part of the NGOs could possibly make it easier for other actors to
enter into partnership with them and dismantle obstacles to certification. This would also
improve the conditions for sustainable development.

Expansion of the range of certification services

Certification of forest resources outside the forest: Products and services similar to those from
the forest can also be provided by other ecosystems dominated by trees, e.g. boulevards, parks
and other urban tree systems, or mixtures and rotation of trees and agricultural crops, which are
particularly characteristic and important for land use in the tropics. The exclusive focus of forest
certification on the forest has so far been pragmatically justified, but involves the risk of
neglecting and discriminating against other viable land use systems. Certification should
accordingly not be restricted to the use of forests, but should cover other land use systems with
a strong tree component.

Certification of environmental services: Because the value of the forest to sustainable develop-
ment lies specifically in the variety of products, forest certification should cover all products and
functions. Specifically, forest certification should also include certification of CO2 binding, water
storage and purification as well as certification of nature reserves.

Multi-sectoral development policy services: The impacts of forest certification are not limited to
the certified enterprises. The whole process of agreement and binding implementation of
standards has institutional impacts on organisations, behaviour and culture throughout the
entire sector, and beyond this in society itself. Forest certification supports sustainable devel-
opment in a particularly effective and obvious way. This development policy benefit should be
much more strongly reflected, embodied and harnessed in the further conceptual and political
development of forest certification.

Listing a number of possibilities for expanding the range of services in forest certification should
not be understood as a call for making these expansions in a rush and within just one certifica-
tion system. Further development of forest certification following an institutionally diverse and
stepwise approach could offer a viable chance of reducing conflict energies and accumulating
cooperation energies.

19
References

References

BURGER, D. / MAYER, C. (2003): Making Sustainable Development a Reality: the Role of
Social and Ecological Standards. GTZ Programme office for social and ecological standards,
Eschborn.

CASHORE, B. / AULD, G. / NEWSOM, D. (2004): Governing through Markets. Forest Certifica-
tion and the Emergence of Non-State Authority. Yale University Press, New Haven & London.

DEUTSCHER BUNDESTAG (1990): Schutz der tropischen Wälder: eine internationale
Schwerpunktaufgabe. Bericht der Enquete-Kommission des 11. Deutschen Bundestages
„Vorsorge zum Schutz der Erdatmosphäre”, Bonn.

FAO (1995): Forest Resources Assessment 1990 - Global synthesis. FAO Forestry Paper
No. 124. Rome.

FAO (2001a): Global Forest Resources Assessment 2000. Main Report. FAO Forestry Paper
140, Rome.

FAO (2001b): State of the World's Forests 2001. www.fao.org/docrep/

ITTO (2002): Forest Certification: Pending Challenges for Tropical Timber. ITTO Technical
Series No. 19.

ITTO (2005): ITTO International Workshop on Phased Approaches to Certification. Bern.
www.itto.or.jp

KAIMOWITZ, D. (2003): Forest law enforcement and rural livelihoods. The International
Forestry Review Vol. 5(3).

LENTINI, M. / VERISSIMO, A. / PEREIRA, D. (2005): A Expansão Madeireira na Amazônia. O
Estado da Amazônia No 2. www.imazon.org.br

MOLNAR (2003): Forest Certification and Communities: Looking Forward to the next Decade.
Forest Trends, Washington.

NUSSBAUM, R. / SIMULA, M. (2004): Forest Certification: A Review of Impacts and Assess-
ment Frameworks. Tropical Forest Dialogue (TFD) Certification Paper Second Review Draft.

PATTBERG, P. (2004): „Private-Private Partnerships“ als innovative Modelle zur Regel(durch)-
setzung? Möglichkeiten und Grenzen eines Konzeptes am Beispiel des Forest Stewardship
Council (FSC). In: BRÜHL, T. et al. (eds.): Unternehmen in der Weltpolitik: Poltiknetzwerke,
Unternehmensregeln und die Zukunft des Multilateralismus. Dietz Verlag, Bonn.

PINTO DE ABREU, J. A. / SIMULA, M. (2005): Setting the Scene: Overview and Implementa-
tion of Phased Approaches. Presentation at the ITTO International Workshop on Phased
Approaches to Certification. Bern. www.itto.or.jp

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Forest certification: taking stock
Dietrich Burger / Barbara Lang / Jürgen Hess

RICHARDS, M. (2004): Certification in complex socio-political settings: Looking forward to the
next decade. Forest Trends, Washington.

SCHERR, S. J. / WHITE, A. / KAIMOWITZ, D. (2004): A new Agenda for Forest Conservation
and Poverty Reduction: Making Markets work for Low-Income Producers. Forest Trends,
Washington.

SEGURA, G. (2004): Forest Certification and Governments: The real and potential influence on
regulatory frameworks and forest policies. Forest Trends, Washington.

SIMULA, M. / ASTANA, S. / ISHMAEL, R. / SANTANA, E. J. / MARCELO, M. L. (2004):
Preliminary Report on Financial Cost-Benefit Analysis of Forest Certification and Implementa-
tion of Phased Approaches. International Tropical Timber Council ITTC (XXXVII)/13.

SIMULA, M. / BURGER, D. (2002): Achieving the ITTO Objective 2000 and Sustainable Forest
Management in Brazil. Report submitted to the International Tropical Timber Council by The
Diagnostic Mission Established Pursuant to Decision 2 (XXIX) Yokohama.
www.itto.or.jp/inside/inside_ITTO.html

SMERALDI, R. (2002): Legalidade predatória. O novo quadro da exploração madeireira na
Amazônia.Amigos da Terra- Amazônia Brasileira, S. Paulo.

SMERALDI, R. / VERISSIMO, J. A. (1999): Hitting the Target: Timber Consumption in the
Brazilian Domestic Market and Promotion of Forest Certification. Piracicaba/Belém.

SOBRAL, L. / VERISSIMO, A. / LIMA, E. / AZEVEDO, T. / SMERALDI, R. (2002): Acertando o
alvo 2. Consumo de madeira amazônica e certificação florestal no Estado de São Paulo, Belém

WHITE, A. / KHARE, A. / MOLNAR, A. (2004): Who Owns, Who Conserves and Why It
Matters. Feature: Forest Ownership. Forest Trends, Washington.

WWF (2005):The effects of FSC Certification in Estonia, Germany, Latvia, Russia, Sweden and
the UK. WWF European Forest Programme. www.panda.org/europe/forests.

21
Forest management: a potential pillar
of sustainable development
Forest management and development
Ronnie de Camino

Forest management and development
Ronnie De CAMINO

Forestry is not in its essence, about trees.
It is about people. It is only about trees
in so far as they can serve the needs of people

WESTOBY (1962)

Forest management has strong links with development. If we are to be consistent with
Westoby’s vision, forest management should no longer be defined in a purely technical sense,
nor should it be considered to be meaningful only for foresters. Forest management needs to be
understood within the context of both „Our Common Future” and „Agenda 21“, which try to
orientate humankind’s current activities and those of future generations towards sustainable
development (UNIVERSITY FOR PEACE 2002). It is not sufficient for forest management to
guarantee a continuous flow of products. Moreover, every single social institution and in
particular, businesses, need to adopt ethical codes which can be implemented meaningfully and
within the context of a fair society and a principle of accountability (MARGALIT 1998, JONAS
2000). Therefore, the author adopts the following definition:

The sustainable use and management of forests (or good forest management) is a process that
gives value to forest as an on-going activity. In addition: 1) it entails the intervention in the forest
for the extraction of wood and other products and services; 2) the harvest of goods and services
is within the productive limits of the system and its carrying capacity, and its level guarantees
the permanent functioning of the ecosystems; 3) the operation is profitable according to the
manager’s criteria; 4) all actors involved in or affected by the process participate in its design,
execution and evaluation and in the distribution of the costs and benefits of the policy and
specific practices, according to their rights and responsibilities; 5) it is part of a sustainable
development, which means that it is not isolated from national development and related sectors,
or from the rights of future generations. Good forest management is a condition which is
reached through successive stages and levels of increasing demands that are in tune with
national and regional realities and with specific actors in the respective forest management unit
(FMU) (DE CAMINO 2002a). Forest management needs to be synonymous with sustainable
development at national, regional or local levels, depending on the relative importance of the
forest resource and its evolution. However, many experiences show that little progress has been
made in terms of integrating effectively the economic development needs of the local
communities with the conservation objectives for forests and diversity. Those who have
participated in forest management have so far failed to find the strategies and orientations
required for translating the principles contained in the definition into effective action on the
ground. On the one hand, businesses have aimed at economic development from the point of
view of optimising profit (income and utilities) while on the other, local and indigenous
communities have not been granted the political and financial long term support needed to
genuinely manage their resources.

25
Current forest management in developing countries
with an emphasis on Latin America

PRETZSCH (2003) and PERSON (2003) both identify various historic stages in policies and
thus in forest management over time:
1. Traditional forest use by local communities: holistic, endogenous relationships, local
knowledge
2. Forest use by colonial powers: specialisation, fragmentation of resources
3. Forests as the basis for national growth: accumulation of capital and its transfer to other
sectors
4. Internationalisation: orientation towards technology and external markets
5. Polarisation: industrial forestry, social and conservation forestry
6. Globalisation: choices between democratisation and devolution or privatisation and
deregulation
7. Poverty reduction, governance, institutions and implementation of law.

It could be said that each and every one of these stages exists simultaneously in different parts
of the world, but that the trend is increasingly towards the last three.

Current forest management in developing countries with an emphasis on Latin
America

Not everything that is taking place in forest management is negative. After all, problems arise,
but solutions are being sought and found. There have been some important events since the
beginning of the millennium:

1. - A positive response to the results of the Earth Summit (Rio 1992), as conditions for
forest management have improved since the nineties. These responses have come from
governments, businesses, non-governmental organisations (NGOs), communities, civil society
and to a lesser extent from donor agencies. There was an initial trend to improve forest
management with a growing number of certified Forest Management Units; to define and apply
principles, to set in place criteria and good forest management with legally binding indicators at
national level in various countries, and to give recognition to the role played by community
forest management as a contribution to sustainable human development.

2. - Forest legislation has been updated in various countries, changing old laws based on the
principle of command and control by others and including decentralisation, delegation of author-
ity, access of communities and citizens to forest management, to adaptive management, etc.
Often there is a large gap between the proclamation and effective implementation of laws due to
the weakness of the official forest institutions and the complexity of the processes, which can
make compliance extremely difficult.

3. - There have been significant institutional changes in a few countries. These changes
have substantially diminished „institutional uncertainties” with outstanding examples in Guate-
mala and Bolivia, where legislative changes have been accompanied by profound institutional
improvements, and a kind of „wiping the state clean”, which has allowed for a regeneration of

26
Forest management and development
Ronnie de Camino

the ruling institutions and getting rid of many abnormalities from the past (CARRERA et al.
2002, FAO 2000).

4. - It appears that the general trend to deforestation has slowed down. In many countries
relevant laws are being more effectively implemented and incentives for better forest
management are more commonplace (DE CAMINO et al. 2000, CARRERA et al. 2002).

5. - The level of knowledge has improved. Although it is true that a great deal of knowledge
also brings new uncertainties, the risks created by an unreliable forest management have been
reduced substantially (AMARAL et al. 1998, MAGGINIS et al. 1998, INAB 1999).

6. - Development of low impact extraction is considerable, reducing the impact on the
remaining trees. The change of crown coverage after harvest varies between 10 and 15%
according to scale, management intensity and type of ecosystem where work is being carried
out, allowing for a normal functioning of the remaining ecosystems (AMARAL et al. 1998,
MAGGINIS et al. 1998, INAB 1999, FAO 1997, HEINRICH 1998, DE CAMINO 2002a,
CORDERO 2002, QUIROS 2002, CARRERA et al. 2002, CABALLERO et al. 2002).

7. - Forest plantations are increasingly being offered as an alternative to natural forests in
order to supply communities and industries with the wood they need. There are numerous
examples of community forest plantations that have increased the availability of products and
improved people’s and communities’ incomes, as is the case in India, Korea and China, and
various countries in Africa, Central and Latin America.

In addition, there are large initiatives for industrial forest plantations in Chile, Brazil, Venezuela,
Ecuador, China and Vietnam, which aim to generate products and wealth, but which, however,
still need to be examined for their social impact, given that they have not brought about a
sustainable human development for the communities in the vicinity of plantation areas. There is
also a complementary use of wood from plantations and from natural forests for compound
products, allowing a much more efficient utilisation of a cubic meter of precious wood for
laminated sheets and chip-board or particle board, using wood particles from plantations. To a
certain extent, this technique allows pressure to be taken off natural forests, at least in some
countries.1

8. - A trend towards an increasingly integral utilisation of forests, including wood, non-wood
forest products (NWFP) and environmental services, allowing in certain cases profit to be
obtained from harvesting products and supplying services. Some forests produce wood, leaves,
fruits and seeds while in addition providing water services, carbon sequestration, and biodiver-
sity and landscape management. Recent developments with regard to Russia’s ratification of
the Kyoto Protocol give rise to new hopes that forests will begin to have more value for land use
and that this will in turn reduce deforestation and conversion to other land uses. This means
that forest management has become a case of simultaneous production of various goods.
However, criteria imposed by developed countries are given priority in international negotiations
and thus far only carbon sequestration by forest plantations has been accepted, whereas
carbon sequestration through forest management and through locking up carbon in protected

27
Current forest management in developing countries
with an emphasis on Latin America

areas is not yet valued, making it difficult to grant financial incentives through transactions
derived from international agreements.

9. - The emergence of forest certification after Rio 1992 has made an important contribution. It
has made exponential progress which nevertheless still only covers a very low percentage of all
the world’s forests. The Pan European Forest Certification (PEFC) system has formally certified
those areas which already have good forest management.

10. - The greater importance and recognition given to the services provided by natural
forests has allowed the use of conserved forests to be valued and it is now considered profit-
able to leave areas as natural reserves or protected areas. Nowadays, there are communities
and private companies developing protected areas for ecotourism, which is currently an emerg-
ing sector important for the local, regional and national levels (DE CAMINO et al. 2000).

It cannot be said that sustainable forest management at a world level and in developing
countries is a widespread activity. Only a couple out of hundreds of forests around the world are
well managed. But good examples are also abundant. It is now necessary to multiply these
good initiatives and extend them to the largest possible number of forests. To this end, it is
necessary to create the social, economic and political conditions on a national and international
basis, granting communities access to natural resources, developing reliable systems for forest
concessions, simplifying procedures, decentralising authority, bringing payments for environ-
mental services into general use in forest management, giving access to credit, etc.

Forest management and safeguarding the subsistence of communities

A high percentage of the rural population depends on the forest to satisfy its needs. The poten-
tial of forests to secure the subsistence of communities requires careful analysis. Some argue
that forests, especially natural ones, are not able to guarantee the subsistence of local commu-
nities. Others exaggerate the possibilities offered by forests indicating that they can support and
bring progress to families in an undefined manner. Neither optimism nor pessimism can be
generalised. There are cases where the forest is not sufficient, even if well-managed, and there
are others that can guarantee the minimum acceptable conditions for the community and,
furthermore, when the resource is rich, society’s development can be based on its manage-
ment.

It is important not to make the mistake of believing that profitability is only a concept without
additional meanings. Profitability is not merely restricted to the concept applied by develop-
mental or commercial banks. For example in the forest ‘ejidos’ of Quintana Roo in Mexico, ejido
landholders paid themselves high wages for their working hours when they started forest
management and commercial operations for the extraction and industrialisation of forest
products. From the point of view of a bank the result is obviously low profitability, as a result of
the high wages paid. In contrast, for the ejido landholders it meant an increase in the remunera-
tion for their labour and thus an increase in their wages. In other words, planned benefits had
been advanced. This is legitimate for people with enormous needs in terms of food and well-
being. The moment when they can think of investment in the community and capitalisation in
forest operations will come in time.

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Forest management and development
Ronnie de Camino

There are other cases, such as social companies, cooperatives which are not thinking in terms
of making large capital investments in their commercial activity (which would be the traditional
approach for a company), but which are trying to invest in social and human capital rather than
in physical capital. For them, the education and health of their children is important, as well as
training and further studies. These communities would be able to concentrate on investing
either in technology or in the infrastructure if not so much of their money was going to the State
for basic social services for the population.

Without a doubt there are communities that have failed in their attempts at forest management
and which have undergone substantial economic losses. Others, by contrast, have managed to
secure the minimum acceptable conditions for the provision of food, education and health.

The forest is a source of partial or total subsistence for many communities. The possibilities of
subsisting become more remote the closer communities are to urban areas. Problems begin
when trying to access markets because many forest products have a restricted market or
market structures become increasingly less competitive the further they are from primary
production.

Box 1 describes inputs for the means of subsistence provided by forests and the impact that
changes in the forests have on communities.

A large number of households in developing countries are consumers of subsistence goods
from the forest. But the percentage of products from these systems is declining and supplies are
increasingly being met by managed trees (agroforestry systems) as well as by natural forests.
However, forests continue to be an important source of products and constitute a reserve that
can be made use of more intensively during difficult times.

Access to forests and tree resources can also help rural households to diversify their
subsistence base and to reduce risks. Forests, therefore, form a safety net for the very poor in
times of hardship.

Forests are a natural capital: past development efforts have mainly focussed on the building of
natural capital, without paying equal attention to the way forests are combined with other assets
to maintain subsistence, especially by the poor. This lack of attention has led to difficulties in
comprehending the contribution made by natural products to sustainable subsistence (DFID
2002).

It is difficult to quantify the total contribution made by forests and trees to subsistence. A
significant part of forest products are consumed by those who collect them; the amount
collected varies according to season, access and alternatives. Most of the information available
is descriptive and often extremely specific to each situation. Few studies quantify the proportion
of household inputs, allocation of labour, income and costs derived from the forest. Studies
have been made on wood fuel and other specific forest products; the surveys and
measurements usually leave out information about their use by households or about activities
relating to a more complete range of forest products (BYRON / ARNOLD 1997).

29
Forest management and safeguarding
the subsistence of communities

Box 1: Forest products and rural subsistence systems (ARNOLD 2001)

Characteristics of inputs used for subsistence Changes that can occur in inputs which
which come from forests originate in forests

Subsistence and cultural importance
Forests form an integral part of the social and Demand for these inputs may weaken, but
cultural frame of reference for forest inhabitants. persists for some aspects (e.g. medicinal uses).
Inputs can become more important when farm
Forest products supplement/complement inputs production or income from non farming activities
from farm systems: fuel, food, medicinal and decline in importance; when support programmes
vegetable products, etc. They are often important by the government or new agricultural crops make
to fill seasonal food deficits and other kinds of it necessary to use forest resources, while income
deficits, especially in times of hardship. Forest increases and external input supplies gain in
food improves the palatability of basic diets and importance and costs make harvesting activities
delivers vitamins and proteins. difficult or divert products from subsistence
consumption into producing surpluses that
generate income.

Agricultural inputs
Forests act as a starting point for shifting Trees can come to have a growing importance as
agriculture and nature protection. Trees on farm a less capital intensive way of combatting the
provide shade, windbreaks and buffer zones of decreasing fertility of the soils and a less intensive
wood and vegetation. They recycle nutrients at a way of maintaining land in productive use (e.g.
low cost and on a wide scale. They also provide home orchards). But a growing availability of
fodder, wicker for baskets to store agricultural capital and access to externally purchased
products, wooden ploughs and other farm tools. products can lead to substitution with other inputs
(e.g. cultivation of pastures, purchase of fertilisers
or plastic packaging).

Commercial products
Trees help to diversify the household farm Some low-input low-income activities can expand
economy, generate income opportunities during as a result of the growing commercialisation of
non harvest periods, and are a source of income rural product designs. However, the majority of
at difficult times. Many products are characterized goods are inferior, and their use is declining.
by the ease and open accessibility of the resource Some are displaced by manufactured alternatives
from which they come and are within the limits of and others are not profitable and are thus no
the capital and skills, possessed by rural farming longer produced as labour costs increase.
families, who mainly engage in small scale Extracted raw materials are replaced with
activities based on home economics, most of domestic products or synthetic substitutes. Those
which are low-return, produced for the local activities which in response to a growing and
markets and are carried out on a part-time basis. specialised demand generate a higher income,
They often fill a deficit or are a complementary are more likely to prosper, particularly those which
source of income with a limited growth potential, serve rural and urban markets. It is probable that
but are, nevertheless, a very important survival a growing proportion of processing and trade will
strategy for the poor, often of particular become concentrated in small rural centres and in
importance to women either as small towns.
entrepreneurs or as employees. Some forest
products provide the basis for full-time high
income activities associated with high entry
requirements for capital and expertise in markets
which are as much uban as rural

30
Forest management and development
Ronnie de Camino

Forest management, including wildlife management, together with access to subsistence
resources by the inhabitants of the forest communities and the communities in their vicinity,
contributes to an increase in income, improvements in food security, reduction of vulnerability
and offers a more sustainable base of natural resources and a greater well-being (DFID 2002).

Increase in income

Sales of forest products complement other income. A large number of households generate
some of their income through the sale of forest products on a part time basis, when farm
production is insufficient for the whole year. Income from the forests is mostly seasonal: some
products can be harvested only at certain times of the year; labour supply and demand can
fluctuate on a seasonal basis; income from forest products can contribute to the purchase of
agricultural inputs or food between harvests. Income is often used to buy inputs for the
performance of other activities, like sowing seeds or hiring additional labour to look after the
crops or to generate working capital for marketing activities.

Improving food security and reducing hunger

Forests are a source of food and both supplement and complement what is obtained from
agriculture; fire wood to cook food and boil water and a wide range of traditional medicines and
other hygiene products (see for example HOUSE et al. 1995). It is probable that a large
proportion of rural households depend on animal and vegetable products from the forest to
satisfy part of their nutritional, cooking and health needs (BYRON / ARNOLDS 1997).

With the supply of materials for the fabrication of baskets, building of storage structures, and
making of tins and tools used for hunting and fishing in peasant farming, forests also contribute
to the domestic economy. They supply inputs for farm systems such as fodder and mulch for
soil protection. They contribute to the recycling of soil nutrients, help to conserve water and soil
and give protection and shade to animals and crops.

Reduction of vulnerability

The poor live precariously, without the ability to alleviate adversity. The existence of forests and
trees plays an important role as a reserve or safety net, sustaining livelihoods and providing
income in times of harvest failure, scarcity, unemployment and during other emergencies or
difficulties or for satisfying exceptional needs. Forest food is used more extensively to help
satisfy dietary deficiencies at particular times of the year and is especially important in
emergency situations such as floods, hunger, drought and war.

Increase of well-being

Forests supply non material goods which contribute to subsistence with the improvement of
social and human capital. A feeling of well-being is dependent on factors such as self-esteem, a
sense of control and involvement, health, access to services and political empowerment. Forest

31
Forest management and safeguarding
the subsistence of communities

management initiatives which support access to resources, participatory decision-making and
equity, help increase this sense of well-being.

It is possible to achieve sustainable subsistence using forests provided that certain conditions
are fulfilled (CARNEY 1998), such as:
The community is resilient to shocks and external stress;
The community is not dependent on external support;
Long-term productivity of natural resources is maintained through management;
Forest utilization does not constitute a risk for the subsistence of others or compromise their
options.

To increase the contribution of forests to the susbsistence of the rural population (WARNER
2000, KAIMOWITZ 2003), it is necessary to have:
A people-centered strategy (taking the subsistence needs of the rural population into
account).
Secure access to forest resources. The rural population should retain or be granted these
rights so that forests owned by third parties can be harvested for subsistence goods (with
agreements and collaboration arrangements between parties for a conflict-free access,
which does not damage the direct interests of those who manage the forests).
Incentives for the planting and managing of forests. These incentives should take into
account promoting the consumption of subsistence goods among the rural population.
Better opportunities. Introducing forest management further in natural forest areas and
plantations can also improve the forests’ contribution to subsistence (for example by
complementing workers’ wages with access to forest products).
New options, such as small-scale forest enterprises, waged-labour in the forest sector, the
planting and natural regeneration of trees for sale, and the use of trees and forests as
inputs for agriculture and husbandry.

Forest management and poverty reduction (DE CAMINO 2002b)

Forests are part of a rural space which includes rural and urban communities. Poverty has been
defined in absolute and relative terms. According to the definition of income in relative terms,
the poor belong to that share of the population with less than 50% of Gross Domestic Product
(GDP) per capita in the country (BEISNER 1995). This definition is very questionable. A poor
person in absolute terms is a person who earns less than 1 $US per day. In reality, the definiton
of poverty is much more complicated, since other variables in addition to poverty need to be
taken into account. Other questions arise, such as whether poverty includes an appreciation of
human development, household sustainability, participation, current consumption, food security,
access to social services, income distribution, failure to cover minimum levels of nutrition, poor
health, education and other services (MAXWELL 1999). Poverty also means a lack of sufficient
food, income and of other goods and services which allow people to maintain an adequate
standard of living and quality of life (ARNOLD 2001).

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Forest management and development
Ronnie de Camino

Almost by definition, a large proportion of forests are in rural areas. The rural landscape
contains different types of forests and both the rural population and rural poverty have a direct
and indirect relation with their quality. Forest resources contribute to the subsistence of 90% of
the 1200 million forest inhabitants who live in extreme poverty. They indirectly support the
natural environment which makes agriculture possible and which provides food to half the
population in developing countries. However, the potential of forests for reducing poverty and
mitigating its effects is not given the acknowledgment and value it deserves (IUCN 2004).

Although official statistics do not exist at either national or international levels, at least there are
some estimates which should give pause for thought. Box 3 shows some figures on
dependency of populations on forests.

Box 2: Some figures which illustrate people’s dependency, including the poor, on forests
and trees (CARNEY 1998)

1600 million people around the world strongly depend on forest resources for their
subsistence, out of which:

60 million indigenous people live in the forests in Latin America, South East Asia and West
Africa

350 million people who live in or close to dense forest areas depend on forests for subsistence

1200 million people in developing countries use trees on farms to generate food and cash
income

More than 2000 million people depend on biomass woodfuels (mainly fire wood) for cooking
and warmth

Forests provide more than 10 million rural jobs in developing countries, to which between 30
and 50 million jobs in the forest industry need to be added

Natural products (many from the forest) are the only source of medicine for between 75-90%
of the population in developing countries

Worldwide, one in four poor people depend directly or indirectly on the forest for their
subsistence

These figures on dependency should signal that forest management by communities, towns, the
state and the private sector need to be included in strategies which aim to combat poverty.

Some figures in Latin America show direct dependency by the rural poor on the forests in the
region:
In Honduras, more that one hundred associations of poor farmers have access to more
than 300,000 hectares of forests (DE CAMINO 2000).
In Brazil, more than 5 million people live exclusively from extractivism, both directly and
indirectly, affecting over 300 million ha. (CLÜSENER-GODT / SACHS 1994, EMPERAIRE
1999).

33
Forest management and poverty reduction

In Chile, small-scale subsistence farmers control 1.48 million hectares of forest in 279
family units (PENA 2000).

In the past decade, the World Bank promoted strategies for poverty reduction. These strategies
tried to maximise the use of natural, human and produced capital to guarantee the minimum
level acceptable for the population. The forest sector has not been used to its full potential, but
efforts to do so must be made. There are countries with a large endowment of forest resources,
for which it is unthinkable not to include the forest sector in their strategies for poverty reduction.
At the same time, there are districts, country towns and areas rich in current and potential
resources, which are compelled to take the forest sector into account in their strategy for the
reduction of poverty. In nations that use their forest potential intensively there is a regrettable
correspondence between the foci for extreme forest development and the rate of poverty in
these regions. In Chile, there is extreme rural poverty in areas where forest plantations are
concentrated, whereas exports from these industries contribute between 9 and 11% of the
country’s total exports (ASTORGA / REBOLLEDO 2004). In Costa Rica there are pockets of
poverty in the areas surrounding the national parks. In the Olancho region in Honduras, which
has the highest pine wood production in the country, inhabitants complain that the regional
authorities are producing considerable wealth, whilst leaving only poverty in its wake in these
rural zones.

SUNDERLIN et al. (2004) reassert that forests have an important role to fulfil in the alleviation of
poverty in at least two ways: Firstly, they are part of a safety net which helps the rural population
to avoid poverty or which helps the poor to mitigate their condition. Secondly, forests have an
un-developed potential which could provide the basis for progress. The contribution of forests to
poor households is not captured in statistics, given that a large proportion of the goods involved
are used to sustain the livelihoods of forest inhabitants or are exchanged exclusively in the local
markets. In addition, most of the wealth generated by wood goes to benefit the better-off
segments of society, while some characteristics of wood resources limit their potential to serve
the poor and excluded. In spite of all these obstacles, forests can undoubtably increase their
contribution to the alleviation of poverty, provided that those taking the decisions acknowledge
their potential and act upon it.

As with many things in forestry and forest management, the potential use of forests has not
been made widely known. The situation of those 1200 million inhabitants continues to be
precarious and is deteriorating as forest degradation takes place. The opportunities offered and
obstacles presented by forests in the alleviation of poverty can be found in (SUNDERLIN et al.
2004, ARNOLD 2001):
The conversion of forests into agricultural land, a practice that has been carried out for
a long time causing deforestation, so that peasant communities can perform agriculture and
have a means of subsistence. Forest has been replaced by agriculture and husbandry as a
way of diversifying out of forest management, transforming the natural forest capital into the
natural land capital for agricultural use. This change has had serious consequences for the
sustainability of agriculture and for the subsistence of communities, with negative
environmental impacts at local and global levels. However, certain complementary forestry
solutions have subsequently emerged through the reforestation of degraded areas by

34
Forest management and development
Ronnie de Camino

businesses and communities and through agroforesty and wild pasture systems. The
change of forests into agricultural land has been part of the process of colonisation and
agrarian reform in which, in order to avoid conflict, forest land, mainly owned by the state,
has been distributed, instead of distibuting agricultural land.
Wood is the main source of value in most of the world’s forests, whether as raw material for
the forest industries or for producing woodfuel. Existing business estimates for wood do not
include much of its value as fuel, for which the highest percentage of its volume is destined.
Improving wood production for the benefit of the rural poor has been met with problems
related to lack of capital, technology and knowledge of distant markets. Additionally, the
poor have never enjoyed wide access to forest resources for the production of wood. In
seeking profitability, the State has taken ownership of the resources and is even
challenging the rights of the indigenous and local communities (DE CAMINO 1997). In
order to contribute to combatting poverty, it is necessary to provide forest-related
communities with access and possibilities for efficient production, as is the case in El Petén
in Guatemala, where forest community concessions were made; in Mexico with forestry
ejidos2 and in Bolivia with forest management in traditional communal lands in the
provinces of Santa Cruz, Beni and Pando (Tierras Comunitarias de Origen).
NWFPs are direct providers of goods for subsistence or for trading in local markets, and do
not have high capital requirements for their production (which can be performed by
individuals). They are available in open or semi-open access ownership schemes. But non
wood products can constitute a poverty trap and those who depend on them could be
condemned to perpetual poverty. A surge of euphoria has encouraged forest management
to concentrate on non wood products so as not to put pressure on the ecosystems, based
on the naïve premise that all that is contained in forests can be sold and in unlimited
quantities. Therefore, it is necessary to look for more profitable schemes for forests’
extractivists which will allow them to control more of the links in the chain of production,
including the combination of wood production with non wood products in an integrated
management system. Extractivism is important in most countries with forests but in some of
these there are stronger marketing organisations providing support as is the case in Brazil’s
extractivist reserves (nuts and rubber) or in some community forestry concessions in Petén
(Uaxactún community with production of thick pepper, gum, xaté or Chamaedorea spp. and
berries).
Environmental services benefit the poor population in two ways: with water and the
regeneration of soil quality through rotating slash-and-burn agriculture. However, the rural
poor do not benefit from external environmental services in neighbouring regions, in the
country and in the global society. This is partly due to the fact that it is not the poor who
manage the land. They could benefit from the storage of carbon and carbon sequestration
arrangements, from the service they provide in terms of protecting biodiversity and
providing hydrological services. Current schemes are being excluded at the moment, given
that national societies and global society still have not adopted the habit of paying for global
services.
Employment and indirect benefits. Forest management generates employment and other
income opportunities such as trade with and services for forestry workers and companies.
In addition, it is expected that forest development will have a trickle down effect, i.e. in

35
Forest management and poverty reduction

creating opportunities for companies, the rural population will also benefit. This is
questionable due to the time needed for this benefit to have an effect. All too often, capital
generated by forest farming is transferred to other sectors of production, and thus forests
subsidise economic activities outside their areas (in Brazil, in the State of Pará, for
example, income generated from the farming of two hectares of forests was invested to
improve one hectare of grassland).

The forest sector can be a large contributor to poverty reduction, provided that a series of
measures are taken:

1. - Giving access to forest resources to poor rural communities, such as occurs currently in
Guatemala with community forest concessions (CARRERA et al. 2002) and in Bolivia
(CORDERO 2002) with community territories of origin (Territorios Comunitarios de Origen) and
local community associations (Asociaciones Comunitarias de Lugar), which favour local
communities and the local indigenous peoples. There are systems operating in Honduras with
rights of usufruct conferred by the State to communities in areas of broadleaf forests
(CABALLERO et al. 2002) and with the transfer of rights of usufruct in municipal ejidos and
national forests to communities, as has been the case in Yuscarán and recently in Gualaco
(GTZ / AFOCO 2002). There are important experiments in Mexico in which rural ejidos control
more than 4.5 million ha of forests and manage them directly.

2. - In granting access, territories traditionally managed by grassroots communities are
recognised, in addition to providing justice regarding territories which had historically been
seized. Also, the norm has been for State concessions to be granted to private companies,
which, as a general rule, have neither managed forests well nor protected the territories granted
from deforestation. The new trend is fundamentally towards granting concessions to forest
communities and indigenous peoples, breaking away from a tradition of asymmetry in terms of
access to forests.

3. - The new policy by the World Bank (WORLD BANK 2002) of providing support to projects on
tropical forests if they are linked to certified operations can become an excellent tool for
increasing the areas under good management and improving access to forest resources for the
poor population. Countries need to put pressure on the World Bank to make sure that this new
policy will be implemented effectively and that forest management will be integrated into the
Strategic Planning for Poverty Reduction.

4. - Combatting poverty requires that the World Bank and the International Monetary Fund (IMF)
not only make recommendations to poor countries on how to reduce costs, but also demand
from the international community the implementation of what is now called ‘Corporate Social
Responsibility’ (CSR) by companies, in addition to what could be termed as ‘International Social
Responsibility’, by international and bilateral cooperation agencies. In this way, substantial
benefits from good management and a good conservation of forests can be achieved. Even
countries with forest wealth can benefit if the World Bank accepts as payment for credit
obligations, certificates (credits) for various environmental services, which it can in turn sell to
countries which have compensation commitments, under the terms of the international
conventions on biodiversity, climate change, desertification, etc. There are differences of

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Forest management and development
Ronnie de Camino

opinion as to whether the State or the private sector should be managing the markets for
environmental services. A successful example, centered on a State management approach, in
one of the few countries in which payments for environmental services have been widely
applied, is in Costa Rica (DE CAMINO et al. 2002). On the one hand, the disadvantages of a
State management approach are exaggerated and on the other the advantages of a company
management approach, whose motivation is profit through brokerage, are also exaggerated.
This could lead to a situation similar to that of (pyramidal and unjust) income distributions, which
today dominate many forest and agricultural products (coffee, pepper, fibers, seeds, fruits)
whereby primary producers receive a low percentage of the final consumer price (0.1% in the
case of coffee). It needs to be restated that the war on poverty is at the same time national and
international, public and private, as well as being a question of economics and ethics.

5. - The poor are poor precisely due to a lack of power and access to resources. The interna-
tional system should help promote and supervise alliances between companies and local and
indigenous communities. Communities have and will continue having forests, a labour force and
traditional knowledge. Companies can bring technology, capital, management skills and
markets. If each and every company worked in alliance with a community, the private sector
could make a contribution to poverty reduction. Such alliances need to be overseen in order to
avoid the subordination of weaker members to the stronger, by for example NGOs which help
communities in their relations with companies, as was the case in the community forestry
concessions of Petén in Guatemala. There is a whole series of impacts that result from
arrangements between companies and communities and which must not be disqualified, but
analysed closer on a case by case basis (MAYERS / VERMEULEN 2003, CIFOR / FAO 2003).

In addition, SUNDERLIN et al. (2004) and KAIMOWITZ (2002, 2003) pointed out a series of
factors which seek to improve the potential of forests for poverty alleviation: decentralisation,
de-bureaucratisation, changes to land tenure systems, democratisation, anti-corruption
campaigns, reallocation of concessions, development of the growing local markets for forest
products, availability of new technologies suitable for the small and medium scale enterprise
and tackling global environmental threats. These factors are complementary to those mentioned
above.

To make a real contribution to a systematic reduction of poverty, forest management would
have to develop from being a collection of projects without a major impact at the national or
regional levels, into becoming a national scheme for forests and poverty reduction with well-
defined policies. There is a need to take policy measures which would allow forestry production
to become a permanent activity with a long term horizon, starting with participation and going
through to self-management, in which the community would decide and the State or NGOs
participate and collaborate (DE CAMINO 2000). Kaimowitz goes further by reasserting that
forestry reform is as necessary as was agrarian reform in the seventies and eighties
(KAIMOWITZ 2002). It would be then a question of taking stock of every forest in every country
and putting them to use by facilitating community access to them. The effect of such a measure
would be variable according to the resource base of the country or region within a country. It
would not solve poverty completely but it would be an important contribution complementary to
forest management.

37
Forest management and securing peace

Forest management and securing peace

The Nobel Prize for Peace was recently granted to a woman ecologist from Kenya. Many would
wonder about the relationship between peace and natural resources and specifically to forests.
The granting of this reward is an answer in itself, given that the control of natural resources has
always been an object of conflict. Wangari Maathai founded the Greenbelt Movement in 1977,
which has since planted more than 10 million trees to prevent soil erosion and provide commu-
nities with wood for cooking. A United Nations (UN) report in 1989 highlighted that in Africa only
9 out of 100 trees felled were replaced, causing serious deforestation problems: runoff and loss
of soil, contamination and sediment in water, problems in finding wood, lack of animal fodder,
etc. The greenbelt programme has been mainly managed by women in Kenyan villages, who
through protecting the environment and through waged work, planting trees, are now able to
provide for their children and their future in a better way (WOMENS HISTORY 2004). Wangari
started from the logic of subsistence and evolved towards a logic of environmental and human
rights and the creation of social capital. Just as forests and trees can help to overcome conflicts,
they can also make them worse. If we refer to the previous chapter on forest management,
subsistence and combating poverty, it is easy to understand the path travelled by the Nobel
Prize programme.

From the very beginnings of the colonial period in Latin America, the King of Spain granted land
rights (as Encomiendas) to subjects who served the Spanish Conquista, in the form of whole
tracts of land, including in them as slaves the indigenous populations who lived there. Peace
was broken in a radical way. Various indigenous tribes were also at war amongst themselves.
However, it appears that natural resources were not destroyed in the wake of these wars,
perhaps with the exception of those between the Aztecs and Mayans. In Latin America, natural
resources were taken out of the hands of those who used them as a means of subsistence and
were put into the hands of others who sought to use them to enrich themselves. A shift occurred
from tribal property to private property involving unimaginable areas of land. After independ-
ence, the encomiendas were inherited by the liberator criollos, who in the best of cases and not
always without a struggle abolished slavery, but who retained the land previously granted in
encomienda and continued with the change of use. In several countries wars continued to be
waged between liberators and the indigenous population, until all the native lands had been
taken away from them. This was followed by a process of transformation and appropriation of
products. In a similar way, but with some variations, this model was also repeated in Asia and
Africa.

In analysing the main causes of conflict in the mountains in Nepal with respect to the
management of natural resources, UPRETI (2001), sums things up in terms of the following
factors:
1. Socio-economic inequalities and ethnic, cast and gender discrimination prolonged from the
colonial period to independence, and even into contemporary modern States.
2. Poor governance: profit seeking, extortion, corruption and domination by one elite, in
addition to political bias. The communities do not have the means to protect themselves
from powerful groups.

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3. Ignorance about local needs, interests and experiences on the part of external domestic
and international development agencies and use of unsuitable technological systems. Non
consultative, non participatory policies were born.
4. Discriminatory implementation of laws and rules skewed in favour of certain powerful
groups.
5. Demographic pressure. The growing population increasingly migrates to forest areas in
order to be able to carry out agriculture in precarious conditions, without land entitlement,
and whilst accelarating deforestation.
6. Criminality and political violence. In forest regions violent conflicts emerge over forest
rights, trade in products and power.
7. Lack of participatory, people-centered mechanisms to solve conflicts based on learning,
and lack of trust by the people in mechanisms for the solution of conflicts sponsored by the
State.
8. Weak, controversial and biased roles for the media and civil society organisations; public
information is poor and does not take the weakest groups into account. In discussions,
nature conservation predominates over the defence of rights for the rural poor and
indigenous communities.

A typology of the most frequent types of conflict linked to natural resources is presented by
WARNER (2000) as follows:

Intra micro-micro situations of conflict

disputes over land ownership and its resources between private and communal owners
(forest plantations and indigenous communities in Chile);
disputes over borders between individuals and groups (concessionary foresters in Guyana);
latent family disputes or disputes among relatives (succession and inheritance);
disputes over natural resource projects taken over by elites or by the landowners who have
the highest quality resources (forest concessions in Nicaragua held by private companies in
indigenous territories);
violation of constitutional or operational rights, such as agreements over the use of
pastures, forests, illegal fund appropriation (restricting access for communities to collect
wood and non wood products).

Inter micro-micro situations of conflict

situations of conflict between land owners and holders of usufructuary rights over resources
(hunters in private and State-owned territories);
situations of conflict between indigenous groups and new settlers (associations of retired
members of the military and indigenous communities in Nicaragua);

39
Forest management and securing peace

disputes resulting from envy which emerges from increasing income inequalities (among
communities and cooperative members who enjoy access to forest);
lack of cooperation among the various groups in the community (discrimination against
women);
disputes that arise when land arrangements are reviewed (companies with development
concession arrangements on forests and indigenous communities).

Micro-macro situations of conflict

opposite needs and values regarding natural resources, for example between the protection
of wildlife and security of subsistence;
cultural conflict between community and foreign groups (Amerindio communities and
personal concessions in Guyana);
disputes over project management between community groups and external sponsors of
projects (creation on behalf of sponsors of projects by parallel organisations to those that
already exist in the community);
disputes arising from political influence (national, provincial and local);
disputes arising from differences between the aspirations of community groups and NGO
expectations or those of the trading companies (NGOs that try to dictate norms to the
communities which correspond with their own values and not with those of the community).

Some examples showing solutions as well as conflict are as follows:

Reclaiming land cultivated by forestry companies on behalf of the Mapuche and
Pehuenches indigenous peoples in south Chile. The communities are currently claiming
areas previously held by them as ancestral territories which were passed on to forestry
businesses through a long, secular process. Forestry companies have almost fenced in the
indigenous population and smallholders and destroyed the relations of production between
former agricultural latifundios and smallholdings, reducing employment opportunities as a
consequence (ASTORGA / REBOLLEDO 2004).
Granting statal concessions of forests in the Atlantic forest regions in Nicaragua to private
companies, in territories reclaimed by Miskita and Mayagna communities. The communities
turned to the Interamerican Human Rights Court of Justice to reclaim their land. But the
conflict grew unnecessarily out of control due to a lack of interest by the government, which
competed for indigenous areas in order to obtain fiscal income through stumpage value of
woods granted through concession (DE CAMINO 1997).
Preferences in terms of granting concessions to private companies instead of to local and
indigenous communities. As a general rule, concessions granted by the State have been
oriented to private companies (in Peru, Indonesia, Bolivia, Cameroon, Nigeria) and hardly
ever to indigenous or local communities (Mexico, Honduras, Guatemala). This fact simply
indicates the relations of power between companies and communities and the lack of
interest by governments in utilising the potential of forest management for the alleviation of

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poverty. During the eighties in El Petén, in Guatemala, forestry concessions were granted
to private companies, who failed to manage the forests and protect them from
encroachment. A multitude of situations of conflict arose in the region: illegal wood logging,
illegal export of wood over the borders with Mexico and Belize, land disputes, plunder of
archeological sites, drug cultivation and trafficking, military and guerrilla presence, etc. By
the mid-nineties a radical change took place in the region. The national commission on
protected areas (CONAP, Comisión Nacional de Áreas Protegidas), created the community
forestry concession (Concesiones Forestales Comunitarias) system, which granted 11
community and 2 industrial concessions to private companies, completely changing the
situation regarding land allocation. This move allowed an increase of governance with the
change of responsibilities and community rights, as can be observed in El Petén, in
Guatemala. There has been a reduction of fires and illegal felling of trees in units granted
as forest concessions, because the communities feel they are the owners of the forests,
which are valued by their inhabitants and on which they depend for their subsistence. This
is the reason why they protect their territorial integrity from forest squatters and prevent the
plundering of wood, fires and illegal logging of timber (CARRERA et al. 2002). Something
similar happened in the State of Quintana Roo in Mexico, when the government decided to
declare invalid concessions granted to para-statal timber companies and gave back the
rights over forest areas to the communities. The communities have been managing these
forests for almost 20 years now. Good governance has radically changed the situation
since community and ejido concessions in Guatemala and Mexico have been certified by
the Forest Stewardship Council (FSC).
The granting of concessions to private groups linked with power. The struggle for the
control of natural resources has been the primary cause of the war in Burma for more than
a century. The exploitation of resources, including timber, has helped finance all the fighters
in the current conflict. For well over 50 years civil war has ruined most people’s aspirations
and restricted any significant development in the country. Burma’s elite and that of the
neighbouring countries have profited from the situation, plundering the natural resources for
material and political benefits, let alone performing forest management. In their case it is
exclusively about exploitation (GLOBAL WITNESS 2003).
Conflict situations which have transferred forest rights to local communities as is the case in
India and joint forest management. In some communities local authorities have resisted the
transfer of rights and responsibilities to the Panyachats, given that officers lose authority
and prestige and therefore they prefer to continue maintaining their control and authority.

For a long time, solving armed conflict through mediation followed by programmes of reconcilia-
tion and reconstruction were the bases on which to build peace. More recently, emphasis has
been placed on the promotion of strategies for the prevention of conflicts, focusing on the local
level, both in post and pre-conflict situations. Good governance, democratic participation and
strengthening civil society are well known local strategies for the prevention of conflict. Less
common but of a growing importance is the creation and implementation of „intelligent” devel-
opment projects, particularly in the area of natural resources. This strategy capitalises on the
need for cooperation among actors in the management of natural resources and the project
provides the pivot or point of support around which to form the local social basis for peace. The
design of community projects contributes substantially to solving conflicts and constructing

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Forest management and securing peace

peace. It is part of the new strategic philosophy carried out by a certain number of donor agen-
cies, which includes the Swedish International Development Agency (SIDA), the Canadian
International Development Agency (CIDA), the UK Department for International Development
(DFID) and the World Bank. The strategy can also be associated with the new framework of
cooperation between the World Bank and the United Nations High Commissioner for Refugees
(UNHCR) (WARNER 2000).

Thus it is possible to conclude that forest management can be a source of conflict between
countries and communities, at the same time as it can become part of the solution for conflicts,
through well thought out forest management projects and programmes.

Forest management and deepening democracy

FUNG / WRIGHT (2003) established that „a fundamental challenge… is to develop transforma-
tive democratic strategies that can advance our traditional values - egalitarian social justice,
individual liberty combined with public control over collective decisions, community and
solidarity and the flourishing of individuals in ways which enable them to realize their potentials”.
For the benefit of the entire society, it would be desirable to transform this imperfect democracy
in which we find ourselves, especially in the poorer countries of this planet, identifying values
that have universal application. Politically speaking, no one can oppose the search for democ-
racy and sustainable development, egalitarian social justice, individual freedom, the control by
communities over their own decisions, solidarity and flourishing of individuals. The authors
mentioned examine real experiences in various countries with what is called „empowered
participatory governance” (EPG), whereby ordinary people participate and influence policies
which affect their lives. In this case it is about influencing policies and, more concretely, actions.

The EPG is another form of expressing what has been termed community forest management in
the case of forests. In the various examples of successful EPG initiatives analysed, we run into
principles, design properties and enabling conditions that are present in the most significant
experiences of community forest management.

The principles of EPG indicate that such experiences usually have the following elements:
Practical orientation: organisations which are developing in this area of work are driven by
very concrete concerns related to practical problems, such as encouraging actors who are
used to competing for power and resources to cooperate and foster more congenial
relationships. Examples of this situation exist in systems of governance in the villages of
Panyachat in Kerala, India, whereby the practical orientation was the devolving of functions
and resources to the local level based on the principle of „subsidiarity“, which encapsulates
the idea that everything that can be carried out and decided at the local level should be. In
the case of the pilot forestry plan in Quintana Roo, Mexico, the problem was also a practical
one: the ejidos lacked the right to use wood in their territories. Another notable case is
Hojancha in Costa Rica, where the community was facing degradation of the soils they
used due to lack of water in the community. Also, migration caused a reduction of the
population by almost 50% in the short space of 10 years. In El Petén, Guatemala,
communities were faced with poverty, deforestation and illegal logging. In general terms the

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discussions around national standards for forest management has brought many actors
together with different visions, at times even contrary visions, in a spirit of collaboration.
Bottom-up participation: In all EPG cases, the search for new channels and application of
new approaches is performed by those who are more directly affected by the problems,
who apply their entire inventive capacity to the formulation of solutions. This is precisely
one of the most distinct characteristics of community management of forests and natural
resources in general The communities of Panyachat in India, the forest ejidos of Quintana
Roo, the Community Concessions of El Petén and the Hojancha community, have
developed their own structures, primarily controlled by members of the community who,
essentially self-motivated, try to solve concrete problems such as those already mentioned
above. Local people prefer more far-reaching and realistic solutions to the narrow type
proposed by those who come from the outside. It is not the case that external elements are
never included, but the latter has been increasingly limited to a more passive and purpose-
oriented task, submitted to the scrutiny of the grassroots community organisation and made
to follow the preferences indicated by the community in accordance with their own culture.
Deliberate generation of solutions: Participants listen to each other and their respective
positions and make group decisions after due consideration. Participants find solutions
which can be translated into collective action, not necessarily those which can be totally
endorsed or which may seem most advantageous, but rather those which offer solutions
which others can accept, and which finally aim to build up a sense of solidarity by trying to
see things from another person’s perspective. This is the approach taken by the examples
quoted in India, Mexico, Guatemala and Costa Rica and by many other organisations with
consultation and governance bodies aimed at generating action and solutions. These
concrete examples have their own defined and regulated discussion mechanisms, which
have to be respected. Furthermore, taking women into account strongly increases
participation. Women now form part of directive boards and special action groups
responsible for concrete tasks and specific production. In some cases women also enjoy
common rights over resources.

In addition to the principles cited above, most cases contain some characteristic design
elements.
Devolution: The State gives back control and accountability to the communities and their
organisations. Grassroots organisations become a substantial public authority given that
they become responsible for the fulfilment of laws. In El Petén, communities have enjoyed
control over the forest for 25 years. In India, communities manage forest areas jointly with
the State. In Quintana Roo, communities have their own organisations which make
decisions over resources which belong to them. In Hojancha, the community has created a
series of specialised organisations whose purpose is to take decisions regarding sectorial
matters. In addition, local representatives of the community now hold key positions in the
national institutional agencies in order to serve the community directly. In Honduras, on the
basis of a community forestry project, a broad social forestry movement is now being
developed in association with the municipalities and with the delegation of forest
management in forest areas owned by the State and the municipalities3.

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Forest management and deepening democracy

Centralised supervision and coordination assumes that organisations and their actions
enjoy a substantial degree of power and discretion but not as autonomous entities,
fragmented in their decision-making. In each case, it has the characteristic of accountability
and communication bringing local units together with subordinate institutions. It is about
developing new forms of coordinated decentralisation. In the case of the Panyachats in
India, forestry services are an important element of interaction, with outcomes of variable
quality. In El Petén in Guatemala, CONAP has been responsible for transferring access and
control. Simultaneously however, the community is self-accountable and duly monitored
with regard to compliance with the terms of the contract. There is an important interaction in
Quintana Roo with state authorities, concretely speaking with the governor’s office, as well
as with the Secretary of Agriculture and Water Resources. Finally in Costa Rica, the
community enjoys the support of several NGOs who are responsible for different aspects,
but who also work in close contact with the authorities in the Ministry for the Environment
responsible for the conservation area of Guanacaste. FUNG / WRIGHT (2003) suggest this
is neither about a democratic centralism nor about absolute decentralisation, since these
are both considered to be unrealisable.
State-centred and non-voluntary: State power is colonised and formal governance
institutions are transformed. Organisations try to influence decisions made by the State
through external pressure. The idea is that in future, and because of this pressure, the
State begins to replicate the three principles mentioned above as well as the design
elements in the rest of its actions. For example, the use of the advanced forest fertiliser
system in Costa Rica, introduced to benefit communities, was first started in the province of
Hojancha and its application is now expanding into the entire country. The same is true of
the ejidos in Mexico; application was first started in Quintana Roo, then on the so-called
ejidos of the Mayan zones. Similar solutions were applied in other ejidos. In Guatemala,
communities even began to bring the State into compliance with community concession
contracts and questioned the government’s decision to declare a mega-park in the areas
granted as concessions. In Honduras, after the experience in Yuscarán regarding
community forestry, which involved the transfer of a mere 3000 ha of pine forest, 27000
hectares were transferred to the communities in the municipality of Gualaco, Olancho. This
is a clear example of how communities have put pressure on the government to go along
with compromises.

In addition to the principles and design characteristics indicated, enabling conditions are also
necessary in order to make EPG realisable. In fact, there are various conditions, which form part
of one overall condition: achieving a balance of power between the parties participating in the
process. This balance of power is achieved through literacy and capacity building, discouraging
any potential for domination, through an obligation to consult before taking decisions, and by
allowing for the possibility for forestry authorities to be questioned. In Hojancha, the community
has taken over the institutions and intensively trained their technical support, administration and
other professional staff. In Guatemala the communities have organisations within their network,
such as the Petén forestry communities associations (ACOFOP), which challenge the State or
private interests when a situation of conflict arises. In Mexico, the ejidos act independently but
form part of civil society groups. This mechanism protects communities from potential unlimited
power that might be inflicted upon them by external actors.

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Finally, in the case of community forestry in Honduras, the principle promoted by Westoby is
followed implicitly, namely that development through forest management is about people, not
trees. In the Yuscarán municipality, after an initial diagnosis, the initiative prioritises integral
human development as a fundamental step, supported by two technical and economic
elements: natural pine forest management and the creation of integral agroforestry farms as
subsistence strategies for the long and short term aimed at income generation and the allevia-
tion of poverty4.

Forest management and the creation of social capital

In today’s world, which is dominated by the economy, any kind of resource provision, ability or
attribute, whether natural or physical, intellectual, spiritual or social, is considered as capital. Not
wishing to create controversy, we shall continue calling such items ‘capital’ here, since they
have already been accepted as such under the concept of capital (even though they could be
named differently).

It is possible to identify several types of capital, which in human enterprises and natural
phenomena can form part of the processes of a system (CARNEY 1998):
Natural capital,
Physical capital,
Financial capital,
Human capital,
Social capital,
Political capital

Social capital definitions

Social capital is the „set of social relationships on which people” or the community „can draw to
expand their livelihood options. These include kinship, friendship, patron-client relations,
reciprocal arrangements, membership of formal groups, and membership of organisations which
provide loans, grants and forms of insurance” (CARNEY 1998).

Relationships of trust, reciprocity and exchange, community rules, norms and sanctions and
links between groups, constitute the social capital necessary to mould individual actions into
achieving positive results for the people, for biodiversity and sustainability in forest management
(PRETTY / SMITH 2004).

We are interested in referring to social capital in forest management because it is about a two-
track relationship. We uphold the hypothesis that good forest management can lead to the
creation of social capital while at the same time the existence of social capital is a precondition
of long-term sustainable forest management.

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Forest management and the creation of social capital

In referring to forest management, the economic incentives to produce physical, political,
economic and institutional changes are important but not sufficient. In almost every case, there
is a need for social change prior to the existence of incentives. The formation of social capital is
crucial before the activities that lead to the formation of physical capital can be initiated
(TEWARI 1998). Social capital is collective, only exists in the social structure that nurtures it,
and has a bigger correlation between local development and institutional efficiency than human
or physical capital. An illustration of this is that Russia has an enormous human and physical
capital but its GDP fell by 45% between 1989 and 1998, while the GDP of Poland, which also
experienced a change of system but which had an organised civil society, grew by 20% during
the same period (SOBRADO 2004).

In this respect, there are cases that clearly demonstrate that indigenous and ejido communities,
in Mexico for example, require more assistance in developing social community capital in order
to allow them to manage new ventures such as ecotourism, water bottling, orchid production,
etc. (DE WALT 2001). Social capital comes before any kind of collective action (TEWARI 1998).

Social capital categories

There are different categories of social capital.

For example, social capital can be grouped into two distinctive but interrelated categories:
structural social capital and cognitive social capital. The structural dimension becomes manifest
in formal and informal organisations and networks (the most visible aspects for example are the
existence in Costa Rica of regional and local organisations, while the cognitive dimension
consists of values, attitudes and beliefs which guide social conduct (the least visible dimension,
CARROLL 2001).

Another useful distinction is made between social relationships that take place between
communities, based on similar history, interest and backgrounds and relationships between
extremely dissimilar groups. The nexus within the group (intra) can be classified as being of a
linking type, is generally deep and strong and makes collective action possible and functional,
while the nexus outside the group (extra), which can be classified as being of a bridging type,
may be weaker and more diverse. The relationships of the linking type have more to do with
daily relationships within the community while those of the bridging type have more to do with
the authorities or with markets (CARROLL 2001).

Also, the concept of social capital can be disaggregated into different types of capital, such as
(CARROLL 2001):
1. Family and kinship relationships.
2. Community networks or formal and informal institutions with social cohesion and a capacity
for action, local knowledge, people’s mutual interdependence (TEWARI 1998).
3. Trans-sectorial links.
4. Frames of reference for political institutions, such as admission of the communities and
actors into politics, access to forest resources (SAUNDERS et al. 2002).

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5. Socio-political relationships (State-civil society). For example the poor and indigenous
communities are included in marketing and ownership systems which can be audited, are
transparent and participatory. Decentralisation confers value on local institutions
(SAUNDERS et al. 2002, BONNAL 1998).
6. Social norms and values, such as a culture of dialogue, visible and invisible, formal and
informal networks (TEWARI 1998).

Pre-requisites for the existence of social capital

All these types of social capital are crucial in any collective action, including in the field of action
of forest management. Social capital requires an institutional and socio-economic climate which
includes symmetrical social relationships (especially of power) and an inclusive approach to
citizenship. This entails (SANREM 2003, JAIN / JAIN 2002):
The opportunity of obtaining an income to cover the needs of the family;
Payment of taxes: contribution to local power structures;
A real opportunity to participate in community management;
Company and citizen literacy with education as a fundamental element;
A process of institutional transformation based on grassroots organisations and a reform
from the top;
Transformation of the paradigms of subsistence and artisanal societies;
Development agents need to focus their interventions on the development of synergies
between the public and private sectors and strengthen networks of local associations,
nurturing the horizontal nexus between communities and providing in this way the
mobilisation of viable, locally-defined initiatives.

Indicators of social capital formation

There is a wide range of indicators for the formation of social capital which can help in this
analysis, such as for example:

Participation of community members,
Participation of women,
Protection against illegal uses of forests (in El Petén, concessionaries protect forests
against fires, illegal logging and export of timber into Mexico and Belize),
Establishing rules for the extraction of resources,
Regulating income distribution,
Participation in the planning processes,
Existence of priorities for investment which favour the creation of human and social capital
in the initial stages of management,

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Forest management and the creation of social capital

Mechanisms for conflict solving,
Community self-reliance,
Formation of strategic alliances with NGOs and private companies appropriately monitored,
Compromises with other aspects of community development.

However, social capital, just as human and natural capital, can depreciate with time and
requires constant renewal To this end, it is therefore important to monitor social capital using the
kind of indicators mentioned above (MAGNO 1998). Among the factors which erode social
capital are market forces, migration and national policies which in many cases destroy commu-
nity institutions in order to manage communal resources. In addition, modern institutions have
encountered difficulties in building up social capital at a sufficiently rapid rate (KAIMOWITZ
2004).

Forest management and Corporate Social Responsibility

Corporate Social Responsibility (CSR) is the commitment that companies make to the
economic, social and environmental development in which they find themselves immersed:
multifunctional companies with an ethical underpinning which permeates their internal culture -
workers (men and women), employees (men and women), shareholders, through their strategic
plans, in terms of the necessities which emanate from their external and internal policies - public
policies, environment, governance, beyond the short-term gain and generation of wealth
(CERESO 2004).

The World Business Council for Sustainable Development (WBCSD) defines CSR as
„businesses’ commitment to contribute to sustainable economic development, working with
employees, their families, the local community, and society at large to improve their quality of
life“. The global business organisation Business for Social Responsibility (BSR) establishes that
CSR is about managing companies in such a way as to fulfil or exceed the expectations that
society has of them, including ethical, legal, commercial and public elements. CSR is seen by
leading companies as more than a mere set of discretionary or occasional gestures or indica-
tions motivated by the market, public relations or other business benefits. It is perceived as
being a comprehensive set of policies, practices and programmes which are integrated into
business practices and decision-making, and which are supported and rewarded by senior
management (WBCSD 2004).

Companies should go beyond the central objective of maximising their profits and enter into
permanent compromises with their workers and their families, with the surrounding communi-
ties, with the micro regional and national community and with civil society in general This
responsibility is not charity and becomes transformed into a moral obligation.

Individual companies, international and national organisations voluntarily adopt a code of
conduct with the actors concerned. It is increasingly a matter for debate whether the adoption of
CSR should be voluntary or compulsory and legally binding. There are even the beginnings of a
debate as to whether one should think in terms of a convention on CSR comparable to the

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Framework Conventions on Climate Change, and on Biodiversity or the Core Conventions of
the International Labour Organisation (ILO).

Taking the initial definition as a starting point, corporate social responsibility by whoever
happens to manage the forest, should take on board that the amount of resources harvested
must be in line with the limits of ecosystems, that operations should be profitable (not only in
terms of prices, but also in terms of costs and general rationality), that the approach should be
inclusive by integrating all actors involved with their various rights and obligations and that, in
addition, it should be part of a sustainable development. Forest management has a rural
orientation and is furthermore directly linked with pockets of poverty in rural and indigenous
communities.

The key actors, who exert pressure on forestry operators and who should be taken into account
in the definition of a CSR commitment (STORA ENSO 2004, WBCSD 2004), are
Consumers,
Employees,
The communities,
Other citizens, nearby and distant,
Investors and shareholders,
Purchasers and suppliers,
The law and those responsible for its implementation,
National and local government.

Having identified the actors, a company or institution which is going to work in line with CSR has
to define a standard which could include:
Principles: a brief declaration of values,
Practices: examples of the means used by the organisation to improve its performance in
respect of standards,
Measures: tangible compliance indicators which can be observed and measured in
qualitative and quantitative terms,
Resources: potential sources of additional information, tools and technologies which a
company may need to implement a routine procedure.

The principles that are usually contained in a CSR standard can include inter alia: ethics,
accountability, corporate governance, human rights, financial return, employment practices,
business relationships, products and services, work with the communities, environmental
protection, markets and consumers (GOODELL 1999, ISO 2002).

A company or forestry operator that subscribes to CSR distinguishes itself by (STORA ENSO
2004):

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Forest management and corporate social responsibility

Good business practices: exclusion of bribery, fair competition practices including the exclusive
use of legal timber in their operations, support to local initiatives without seeking to destroy them
through competition.

Communication: regular information to and consultations with the public about the company’s
general and local plans, for example over wood transportation through the communities, logging
close to the villages or hamlets that can be affected by the noise from operations, etc.

Commitment to the community: transparent relationships with the surrounding communities and
cooperation with them in emergencies, but also in the creation of human and social capital. Any
capital that may be formed should not be invested simply as a way of improving the return on
business, but also to improve the conditions of the community and its inhabitants. For example,
by giving access for the communities to products which are not part of the main business
(woodfuel, possibility of using off-cuts from the wood for handicrafts, etc.), by promoting the
capacity building of local leaders and good students, etc.

Labour force: often, when there is a shift of technology, companies increase their production
and reduce their labour force through massive lay-offs. This type of action should be avoided or
postponed until the human resource that is being displaced is trained in another area or has
been supported by creating alternative businesses connected with his/her previous experience.

Working conditions: these need to be guaranteed, attractive, fair and humane. This implies, for
example, adequate food, training for carrying out given tasks, quality of work-camps, first aid,
health, safety equipment, and all critical aspects relating to carrying out forestry tasks.

Diversity: implies respect for ethnic, cultural, religious, gender and social differences. By taking
diversity into account, it is possible to create acceptable conditions for women, the handi-
capped, older adults.

Freedom of association: complying with legal norms and even motivating workers’ organisations
and sharing channels of communications in addition to giving clear and fast responses.

Free choice of work: promoting workers’ capacity building and training so that they can aspire to
occupy other jobs within the company.

Child labour: strictly complying with the provisions on child labour, cooperating with the authori-
ties to restrict this criminal practice.

Remuneration: since the idea is to try to comply with and even exceed the legal requirements,
this could imply wages which are above average, which are fair and which not only allow
subsistence but also the development of workers.

Working hours: in conformance with labour legislation, taking the hours needed for transporta-
tion into account (to carry out forest tasks in places which sometimes need several hours to
reach, adding up in some cases to more than 12 hours per day if the 8 hour ‘working day’ is
applied).

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Forest management and development
Ronnie de Camino

We could develop a similar list in terms of company attitude with regard to each of the actors
involved, that is to say, clients, authorities, shareholders, etc. CSR can also be defined with
respect to forest management for multilateral and bilateral agencies, central governments,
municipalities and NGOs. It is basically about the promotion of integral human development of
the actors involved, human capital and social capital development, as well as fair treatment
within the framework of a decent society (MARGALIT, 1998)5.

Currently, there is much debate around CSR in the companies. Some employers even go so far
as to ask whether a company needs to have ethics when the main objective is to make profit for
the owners or shareholders. Within the forest sector the debate around CSR is similar to the
one over good forest management certification, as issued by the various schemes. Studies on
the extent of compliance by companies with CSR about to be issued a certification by the FSC,
for example, are already underway. ASTORGA / REBOLLEDO (2004) consider that forest
certification is an illustration of CSR: health, security and well-being of the men and women that
work in companies; mitigation or complete elimination of the negative social impacts that
forestry activities generate in the communities, respect for indigenous peoples’ rights and the
possibility of bringing together and certifying in a joint manner forests and forest plantations of
small and medium-size forest owners.

It is worth highlighting the need that exists for every institution involved with forest management
at any level to publish their level of compliance with CSR. This would allow a completely differ-
ent level of quality in terms of forest management development. There are already important
qualitative differences between certified and non-certified forest management.

Forest management as an engine for economic development

We are now faced with the hypothesis that forest management can transform itself into a pillar
of economic development. For the time being, we will not distinguish whether this development
takes place in human, integral or sustainable terms, but simply whether it produces economic
growth in terms of production. We will also give a microeconomic emphasis to this analysis, that
is to say we will focus on the contribution that forest management units make to this growth,
since, in strict terms, forest management is the planning and execution carried out by a speci-
fied management unit.

A well-managed forestry unit has a strong impact on local sustainable development at the same
time that it supports sustainable regional and general development. Horizontal and vertical
integration in forest management allows a higher impact on development to take place. Some of
these effects are (WESTOBY 1962, DE CAMINO 1972, POOL et al. 2002):

1. - Forest management allows the use of very different technologies and of a highly flexible
approach to production as regards the relationship between intensity of work and intensity of
capital. It is possible to organise forest production involving small or large forest owners provided
that a horizontal integration of small forest owners, based on organisational technologies, is
achieved at adequate scales. At one end, there are large companies with huge areas of land,
which include forest plantations or natural forests, and at the other smallholders who act
individually and are organised in cooperatives or associations to improve their efficiency and

51
Forest management as an engine for economic development

power of negotiation. Also, forest management is very flexible in terms of use of technologies
and labour force, allowing operation in different conditions of scarcity of capital and relative
abundance of labour.

2. - Production of multiple species for forestry use and other uses, in addition to multiple
services with local, regional, national and global clients. There is a trend towards a division of
production, in which communities are responsible for producing non-wood products and
companies for wood production. However, an integrated forest management, orientated to
various products and with different levels of integration at the same time, would allow a stable
and less risky production. Even in the controversial extractive reserves in Brazil, the need to
make use not only of rubber and chestnuts but also of timber is being re-examined as a way of
consolidating communities in economic terms.

3. - Complementarity in time and space of forestry activity with other activities in rural areas,
especially with agriculture. This concept offers large flexibility for an integrated management of
soil resources, combining agricultural and forestry activities, for example.

4. - Orientation in the rural space, therefore presenting a valid alternative for economic devel-
opment in the rural areas. It is not only about development of forests, but also about the possi-
bility of supplying industries in rural areas. Forest management can be a substantial contributor
to the development of infrastructure and to its maintenance. This presents both an advantage
and disadvantage in the sense that it opens territories previously closed to other activities and
can therefore represent a change of land use. However, in order for rural development to take
place, there has to be a commitment from central government in terms of providing rural zones
with a road, education, health and leisure infrastructure (similar to that of medium or larger
urban centres) that will appeal to the rural population inducing them to stay, and changing
positively the image of the rural areas.

5. - During the seventies, there was a huge pressure for import substitution mainly driven by the
contemporary dominant model of development. Currently under the influence of the process of
globalisation, there is a strong pressure to expand exports, and the forest sector in the tropics
allows for a clear orientation towards exports, an activity which thus far has not been fully made
use of. It is estimated in addition that the future demand for wood and forest products in
developing countries will be very high, and thus production could again target domestic
consumption. Some countries like Chile orientate their forest development and production
towards the export market. In others, like Costa Rica, tourism based on its forests represents
the most important source of revenue. As in the case of these two examples, there is a multi-
tude of options that would allow regular production to be orientated towards export markets.

6. - Forest management has strong links with other sectors of the economy, but it essentially
provides the ecological basis for agricultural production, energy production, irrigation and water
production, the stability of the ecosystems through biodiversity and, consequently, for the
production of forest industries. With so many links to the local, regional, national and interna-
tional economies, the multiplier effect of forest management in particular and of the forest sector
in general is very high.

52
Forest management and development
Ronnie de Camino

7. - Forest management, especially in plantations can be very attractive economically as an
alternative to investment. Countries like Costa Rica and Panama have attracted considerable
investments with growing prospects in the development of forests with valuable species, such
as teak, for example. In this way, land that often was too degraded for agriculture and cattle
use, has increased its potential for forestry, industrial production and export.

8. - Forest management is directly linked with other activities, like the management of water
basins, with the forest as the basis for seasonal production and distribution of water. This form
of production has been slow to be reflected in the markets, but it is beginning to generate
payment for environmental services contributing towards the protection of water catchments.
Forest management constitutes an example to be followed by other sectors and other types of
production because of its ecological benefits and display of responsibility, especially in relation
to certified forests.

9. - The trend towards developing social forestry has somewhat tarnished forestry development
in private forests. However, forest management allows a very wide range of solutions for all
actors involved. Forest management can be carried out by the State on its national forests, by
companies with concessions in natural forests and on plantations by individual owners - small or
large - and by rural and indigenous communities. Depending on the resource, actor and
regional and national circumstances, forest management by any of the players is a valid option.
There can also be a combination of actors through different types of alliances.

10. - The advance of forestry science now allows forest management of natural forests and
plantations to be carried out with low environmental impacts (lower than with alternative land
uses, cattle, agriculture and urban use) and it is even positive in terms of generating water,
biodiversity, locking up carbon, and enhancing landscapes.

Conclusions

We have reviewed in this chapter various elements which establish a link between forest
management and development. Going by the definition of forest management as part of
sustainable development in a region or a country, we have seen its relationship with:
Sustaining livelihoods in rural areas
The fight against poverty
Peace and security
Deepening democracy
The formation of social capital
Corporate Social Responsibility

We went on to examine the relationship between forest management and economic develop-
ment with an enumeration of the favourable characteristics it offers. This, alongside the relation-
ships already mentioned, strengthens the view that forest management, on different scales

53
Forest management as an engine for economic development

according to circumstances, can become a real pillar of sustainable human development in its
economic, ecological and social dimensions.

If we are to go by MAX-NEEF’s (1993) definition of human development, it becomes evident
that:
Development on a human scale concentrates on and sustains itself from the satisfaction of
basic human needs (sustenance, poverty alleviation), from the generation of growing levels of
self-reliance (social capital, deepening democratisation), and from the organic articulation of
human beings with nature and technology (peace and security), of global processes with local
behaviour (CSR), of the personal with the social (social capital), of planning with autonomy and
of civil society with the State (deepening of democracy).

54
Forest management and development
Ronnie de Camino

Notes
1
An interesting example is given by PORTICO in Costa Rica, a company that manufactures quality
doors and which instead of using solid mahogany wood (Carapa guianensis) uses heartwood from
certified Gmelina wood, covered by a layer of plywood from mahogany, thus providing an increase of
production using the same amount of native timber.
2
Ejido is the collective access to land by organised peasant farmers. Ejido has its origin in the Mexican
revolution.
3
L. Espinoza, personal information, 2004
4
L. Espinoza, personal information, 2004
5
MARGALIT defines a decent society as one in which institutions do not humiliate people. This implies
that companies will not fence in indigenous communities with plantations, wiping them off the map or
denying them access to the landscape with which they culturally interact, nor will they pollute the rivers
or fill village streets with dust. Companies will respect trade unions and the municipalities will process
promptly formalities relating to the communities. Central governments are decentralised so as to effi-
ciently take care of matters and sanction corrupt officers; NGOs will not impose solutions, but help
communities in conformity with their own solutions, etc.

55
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Requirements for sustainable forest management
Dietrich Burger

Requirements for sustainable forest management following the
paradigm of sustainable development
Dietrich Burger

Concepts of sustainability

Traditional concepts of sustainable resource utilisation

All sustainability concepts are based on striving to utilise resources without using them up.
Humans have been aware of the life-threatening risk involved in over-utilisation of natural
resources since time immemorial The Gilgamesh epic described 4,000 years ago how over-
utilisation of forests led to the destruction of arable land, roads, irrigation and shipping routes,
and finally to the downfall of the Sumerian kingdom (GARDNER-OUTLAW / ENGELMAN
1999: 9).

In many cultures there are customs and rules, and possibly even taboos and religious laws,
aimed at preventing overuse of natural resources. Their purpose may be to conserve the stock
or functions or renewability of natural resources. Such rules can take many forms, for example
hunting seasons, fishery rules, or fallow prescriptions.

Forest sustainability

Hans Carl von Carlowitz, son of a Saxonian chief forester, chief mining warden to the Elector of
Saxony and King of Poland, August the Strong, was the first to use the term „sustainability” in
his book „Sylvicultura oeconomica, Anweisung zur Wilden Baum-Zucht” („Manual of wild forest
cultivation”), published in 1713 (CARLOWITZ 1713).

As a young man travelling through Europe between 1665-1670, he was interested in how the
various countries dealt with the shortage of wood, one of the main problems for industry at the
time. He was particularly impressed by the „grande réformation des forêts” instituted by Colbert,
minister of finance to the French King Louis XIV. As Carlowitz wrote, the decrees of Louis XIV
contained everything for his own project.

Following the Mercantilist school of the day, economic policy was aimed at meeting the vast
financial needs of an absolute monarchy. Silver mining was particularly important for this in
Saxony. However, this was threatened by a shortage of wood. As a result, skill, science and
zeal were needed to „organise conservation and cultivation of wood to permit continuous and
sustainable use“ (CARLOWITZ 1713: 105). Only as much wood should be used as was regen-
erated. In his book, Carlowitz also dealt with the question of reducing demand for wood in
households, construction, brewing, mining and the extractive industries through greater
efficiency, and using alternative fuels such as peat. According to Carlowitz, the „poor subjects”
had a right to „adequate nourishment and comfort”, but the same rights applied to „their beloved
posterity” (GROBER 1999). Intergenerational equity was accordingly already part of sustainabil-
ity for Carlowitz.

61
Concepts of sustainability

Carlowitz’s work attracted much attention in Germany. The notion of sustainability in forest utili-
sation became the basis for the science of forestry which developed in the 19th century. Gradu-
ates of German forestry academies worked in Russia, Scandinavia, France, India and the USA,
and made „sustained yield forestry” a key term worldwide. Later, the idea of sustainability of
wood use was extended to all aspects of forestry (cf. SPEIDEL 1967: 169). „Sustainability”
describes „the ability of forestry to utilise wood continuously and optimally and provide infra-
structural services and other goods for the benefit of present and future generations” (SPEIDEL
1972: 54).

Sustainable forest management as a contribution to sustainable development

Consciously using forest management for the purposes of sustainable development poses a
much greater and more comprehensive challenge than the aim of sustainability in forestry to
limit wood use in its many functions to the regenerative capability (BURGER 1999: 25).

The present paper is based on the publication of the GTZ Programme Office for Social and
Ecological Standards „Making Sustainable Development a Reality: the Role of Social and
Ecological Standards” (BURGER / MAYER 2003). The paradigm of sustainable development is
accordingly only presented briefly here. The following sections will consider the principles of
sustainable development in terms of their specific application to forest management.

The paradigm of sustainable development adopted at the UN Conference on the Environment
and Development (UNCED) in 1992 in Rio de Janeiro by 178 governments of countries with
every kind of location, history and culture is often criticised as too vague and imprecise.
KREIBICH (1996) describes it as „empty words designed to produce a consensus”. It would,
however, be wrong to expect the paradigm to deliver precise specifications for development
goals and approaches for every single country. The paradigm does not provide a development
path as such, but rather helps in the search for development approaches, which may be
very different depending on the ecological, historical and cultural environment.

The paradigm provides a direction for development approaches by emphasising that resources:
should be used in a way which does not limit the opportunities of future generations,
should be used efficiently,
should be used in such a way that revenues and costs or opportunities and risks are
equitably divided between social groups.

Two further principles provide a guide in structuring the search for development approaches:
as many as possible of those affected should be able to participate in the search by
contributing their points of view, experience and abilities and stating their interests, and the
goals selected should be fairly negotiated, and
programmes formulated for a given level, e.g. national, should not conflict with programmes
for higher (e.g. global) or lower (e.g. local) levels, following the maxim „Think globally, act
locally”.

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Requirements for sustainable forest management
Dietrich Burger

The search for development approaches should consider all resources and their impacts in a
holistic manner, in other words all material and immaterial resources needed for human life, i.e.:
natural resources or environmental resources, such as the biosphere, landscapes and
biotopes with the elements air, water, soil, minerals, vegetation, fauna;
economic resources, i.e. tangible assets produced by humans such as machinery, roads,
buildings, and financial capital such as money, shares, payment obligations;
social resources, i.e.
• human capital (people with their training and health) and
• social capital, the stock of rules, institutions and collective knowledge that determines
„how individuals and societies interact, organise, and share responsibility and rewards”
(WORLD BANK 1997).

Box 1: The paradigm of sustainable development

does not describe a state
or a goal
or the road to sustainable development;

it provides orientation for the
search for development approaches

through
• principles providing orientation:
prudence in dealing with resources
efficiency
social equity
• principles guiding action:
partnership
coherence
• integration of
natural,
economic,
social
resources and impacts

Sustainable forest management, understood as forest management in the service of sustain-
able development, must take into account all the resources used and consider the cited princi-
ples of sustainable development in dealing with them. As these principles can never be imple-
mented simultaneously and fully, sustainable forest management can only be an
ongoing process of search and improvement.

63
Concepts of sustainability

Just like sustainable development, sustainable forest management is an extremely complex
process. As people have difficulty in coping with complexity, the strategy usually adopted is to
reduce complexity by considering only simplified aspects of reality, for instance specific
resources and the impacts of using them (e.g. economic), and ignoring other resources and
impacts. This approach runs into difficulties if people forget that only one aspect of reality has
been considered and apply the results of the analysis or decision making process uncritically to
reality in all its complexity.

The paradigm of sustainable development involves a completely different strategy for coping
with complexity, refusing to omit any significant aspect of reality and involving as many inter-
ested parties as possible in the search for development approaches, so that they can contribute
their different perceptions, experience and interests to the search process. This strategy of
dealing with complexity involves
negotiation instead of filtering.

Participation in the search process by diverse interest groups necessarily involves conflict. If
sustainable forest management follows the paradigm of sustainable development, this means
cooperative conflict resolution instead of confrontation.

Sustainable forest management in this comprehensive sense follows the Rio paradigm, and
requires not only ecological, technical and economic competence, but also a large measure of
social competence.

Principles and rules of sustainable forest management

The principles of sustainable development apply to all areas of human life and all sectors of the
economy, including forest management. They are general guidelines, which can be turned into
precise rules. The principles and rules in fig. 1 for sustainable forest management were formu-
lated by analogy with the general principles and rules of sustainable development.

The principle of prudent use of resources

The principle of conserving resources rather than consuming them, i.e. dealing with resources
so that future generations have at least the same opportunities for shaping their life as the
present generation, sounds very straightforward, but requires some explanation:
When handing down resources, it is not just a question of their quantity but also their
quality, and specifically their functionality. For example, when replacing natural forest with
plantations, great care must be taken to consider whether the increase in wood production
represents a gain or loss for future generations in view of the loss of biodiversity, and
possibly also water storage and other functions (cf. COSSALTER / PYE-SMITH 2003).
The principle applies not only to natural resources, but also to all other types of resource
used by forest management. For example, when introducing new forms of forest utilisation,
care must be taken to check whether this involves a loss of traditional arrangements, such
as communal risk management or other social capital.

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Requirements for sustainable forest management
Dietrich Burger

Equity towards future generations involves not only the descendants of the forest owners,
but also the descendants of all those using the forest. With an eye to the global functions of
forests, it is necessary to check whether it can be assumed that these vital functions are
being preserved for future generations as well.
Intergenerational equity does not mean demanding that all resources are handed down in a
completely untouched state. The principle is not a ban on development. If the current
generation were not allowed to use resources and develop, this would also reduce the
opportunities available to future generations. The quality and composition of resources are
accordingly altered, but this should be done with an eye to the development opportunities of
future generations.

Figure 1: Principles and rules of sustainable forest management following the paradigm
of sustainable development

regeneration rule
substitution rule
prudent use
intensity of stress rule
of resources
precautionary rule
integrated resource accounting

efficiency technical rationalisation
ecological efficiency
market efficiency
sustainable forest
management
following the paradigm of consideration of
sustainable development social equity objects,
groups,
legitimation
of claims

partnerships in the added value
chain and in governance -
partnership networks considered as assets;
success dependent on distribution
of roles and partnership capability
of members

thinking beyond partial systems;
noting lack of coherence with
neighbouring systems;
assessing risk to sustainability;
coherence correcting lack of coherence;
minimising frictions and hence
economising energy;
increasing changes of alliances
and support from outside.

65
Principles and rules of sustainable forest management

Regeneration rule: Use of renewable resources should not exceed their regeneration capabil-
ity. This means first of all that harvests must be smaller in quantity than growth before the next
harvest. A purely quantitative comparison of harvest and new growth, however, is not enough to
ensure the conservation of the value and regeneration capability of natural capital.

This is very clear if we take tropical forests as an example: the removal of relatively small
quantities of high quality wood may be less in quantity than the wood which re-grows before the
next round of logging, but because the trees felled are often replaced in natural succession by
fast-growing but lower grade pioneer species, normal selective use of the best trees - even in
small quantities - generally means downgrading the stock of wood. The quality of harvest and
new growth must also be compared. To preserve the full functionality of the forest for the
environment (e.g. protection against erosion), economy (e.g. wood suppliers) and society (e.g.
cultural value) and its regenerative capability, use and regenerative capability must match in
quantitative and qualitative terms and also in pace. To ensure this, forest management should
seek to maintain a balance as close as possible to nature in terms of diversity, distribution, age
profile, and pace of growth and rejuvenation. Sustainable forest management must allow
regeneration not only of trees, but also of other plants and fauna.

In terms of economic goods, the regeneration rule is reflected e.g. in regulations on depreciation
and provisions. It should also be taken into account with social resources. Regeneration of
employee health and knowledge has found its way into the subject of sustainable forest
management, with trade unions playing a significant role. By contrast, social capital and its
regeneration have had virtually no impact as yet in the context of sustainable forest manage-
ment. Traditional rules often incorporate knowledge stored over generations. If such traditions
are abandoned and not replaced by new learning, there is a loss of social capital. The knowl-
edge of a society must be regenerated by lifelong learning by its members. Social security
systems, forms of conflict resolution and other social codes also need to be reproduced at least
to the extent that changing conditions make them obsolete, otherwise assets are lost.

Substitution rule: The German Bundestag commission of enquiry on „Protecting humans and
the environment” issued the following call: „Nonrenewable resources should only be used to the
extent that a physically and functionally equivalent replacement in the form of renewable
resources or higher productivity of renewable and nonrenewable resources is achieved”
(DEUTSCHER BUNDESTAG 1998: 46). The composition of the resources used by forest
management inevitably changes over time. Besides the substitution rule, however, replacement
of resources in one category by those in another category is only permissible if the resources
are equivalent. However, this equivalence can only be evaluated with the participation of those
affected. The commission of enquiry emphasised the need to compensate for loss of
nonrenewable resources through increased social capital „The society of the 21st century will
depend more than ever on developing social, intellectual, creative and cooperative skills and
abilities. Material resources must be replaced by an increase in the stock of knowledge.”
(DEUTSCHER BUNDESTAG 1998: 42). This necessity will also extend to forest management,
particularly in countries where natural forests are being depleted like nonrenewable resources
and transformed into agricultural areas, wood plantations, or secondary forests. If this process
cannot be delayed, the loss of natural capital should at least be cushioned by an increase in

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Requirements for sustainable forest management
Dietrich Burger

social capital. For example, an effort could be made to compensate for the loss of natural
resources (if this is inevitable) through investment in training for the population.

Intensity of stress rule: „It is not scarcity of resources that threatens to set limits for the
economies, but the limited ability of ecological systems to accept stress from pollutants and
waste of all kinds“ (BUND / MISEREOR 1996: 23). The intensity of stress is given by the level of
stress and the speed of recovery. This has to correspond to the response capability of the
resource. Just as natural resources can only be stressed to certain limits by substances injected
into the environment without losing their ability to function, social resources are also limited in
the stress they can handle. For example, social cohesion, which forms part of social capital,
cannot be subjected to an unlimited extent to unequal distribution of opportunity without
damage, i.e. without reducing social capital.

Precautionary rule: Principle 15 of the Rio Declaration says: „Where there are threats of
serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for
postponing cost-effective measures to prevent environmental degradation” (UNIVERSITY FOR
PEACE 2002: 55). If e.g. there are indications that certain forest management processes are
endangering the forest population of rare species, tackling this danger may not be left until
extinction has become a certainty. At this point, countermeasures generally have no prospects
of success. Economic and social resources should be treated with similar awareness of risks.

Integrated resource accounting rule: The above rules are necessary but certainly not
sufficient conditions for ensuring the availability of resources for future generations. To prevent
consumption of wealth, regular accounting is essential However, this must account for all kinds
of assets. Although this sounds a trivial requirement, the current system of national accounts
does not satisfy it, as it does not take into account changes in environmental assets, human
resources and social capital. Destructive forest exploitation increases the domestic product
calculated in this way, but the resulting damage to the economy is ignored. This distorted view
bears much of the responsibility for the generally minimal interest in sustainable forest
management on the part of macroeconomic planners.

However, forest planning is also far removed from holistic accounting of assets. While much
progress has been made in the inventory and accounting of stocks of wood, little attention has
been paid to the development of other forest resources; procedures for accounting for economic
goods (particularly finance and tangible assets) are extensively used, but changes in human
resources are rarely and only incompletely considered; changes in social capital are not even
documented. As a result, even if the stock of wood is prudently utilised, forest management can
lead to a loss of assets without this being noticed in time.

The efficiency principle

Efficiency is the use of resources where the relationship between resources used and resulting
impact is as favourable as possible. This can be because a specific impact is achieved with the
smallest possible resources, or because the largest possible impact is achieved with a given
quantity of resources. The efficiency principle can be interpreted technically or economically. A
specific version of the efficiency principle is the principle of ecological efficiency, which deals

67
Principles and rules of sustainable forest management

specifically with the use of environmental resources, particularly water, energy, and natural
primary commodities.

If the relationship between the resources used and impact is calculated at market costs and
prices, the result expresses the economic efficiency. In this form, the efficiency principle is
increasingly dominating not only the private sector, but also politics. Economic efficiency can
have a very important control function for sustainable development if competition results in the
provision of products and services at lower cost and stimulation of innovation. However,
markets can only perform this positive control function if prices and competition are not
distorted, e.g. by subsidies or incomplete information, and if products and services can be
offered in markets, which is often not the case for ecological and social functions. Something
else to bear in mind is that the market is generally blind to ecological and social goals, unless
potential buyers demand and reward ecological and social aspects.

Economic efficiency also has an important control function in forest management. Conversely,
in addition to the commercial production of goods and services, forest management also has
ecological and social impacts on the lives of many people. This is why it is particularly important
for sustainable forest management that the legal and political environment and free market
measures should ensure that social and ecological considerations are taken into account
appropriately in decisions on forest management.

Forest management need not always primarily serve the goal of wood production. The water
supply and preservation of biodiversity are also possible goals of forest management, and many
other such objectives could be listed. However, the efficiency principle must always be consid-
ered, as there is always a scarcity of the resources being used, so that the aim must be to
achieve the greatest possible impact.

Not least, the efficiency principle must also be followed when utilising human resources and
social capital, e.g. by employing people in accordance with their qualifications, or striving to use
forms of conflict resolution as effectively as possible.

The social equity principle

The changes caused by forest utilisation can have very different impacts on different social
groups, with some gaining and others losing. It is accordingly not enough to consider the
impacts at a global level: instead, it is necessary to break them down by social groups and
consider which groups have which legitimate claims, and how far these are met.

Equitable distribution of the benefits and disadvantages of resource utilisation between social
groups
neither follows necessarily in the wake of a free market economy, as assumed in the
„trickle-down-theory” or „horse-and-sparrow theory” („if you feed a horse enough oats,
some will pass through to the road to feed the sparrow“),
nor is social equity a purely humanitarian concern to help the weak;

68
Requirements for sustainable forest management
Dietrich Burger

instead, social equity is a prerequisite of economic capability: „Establishing equity or
equality of opportunity for primarily social policy purposes is not just a social goal - it is also
a prerequisite for long-term economic capability, and accordingly an economic goal as
well.” (DEUTSCHER BUNDESTAG 1998: 33). There are two reasons for this:
• disadvantaging individual groups can prevent the development of potential;
• discrimination can cause discontent, which impacts the will to work and leads to
disturbances and conflicts.

In examining social equity, i.e. the claims of different groups, three questions have to be
resolved:
What is the object of the claims?
• rights of access to resources,
• chances and risks,
• revenue and costs,
• participation in decisions and power.
Who are the groups making the claims (stakeholders)?
• owners,
• employees,
• neighbours,
• customers, consumers,
• suppliers, service providers, investors,
• officials,
• training institutes,
• public, media,
• political parties,
• associations,
• advocacy groups, such as
- environmental NGOs
- social NGOs
- trade unions
- religious groups, churches.
What is the basis for legitimation of the claims?
• statutes and other binding law (legality),
• international conventions and agreements, and particularly human rights and ILO core
labour standards (cf. TOMUSCHAT 2002, REICHERT 2002);
• traditional rights.

Because forest management has a very wide range of functions and can have a very deep
impact on life, a very wide range of claims with different bases must be expected from a variety
of groups. Ignoring the types, groups or bases of claims may seem pragmatic at first glance, but

69
Principles and rules of sustainable forest management

can prove short-sighted. For example, in many developing countries, traditional communal land
rights which national governments reserved for themselves, in some cases many years ago
(e.g. forêts classées in West Africa) and had often granted as concessions, are now being
reasserted. If each group tries to assert its claims on the basis of different legitimation, this can
lead to dangerous conflicts and substantial frictional losses in forest management. Examples
are the road blocks stopping wood transport from concessions in Bolivia in 1999, the call by
national and international NGOs for a moratorium on logging and certification of concessions in
Indonesia at the start of the present millennium, or the destruction of teak plantations in Togo at
the start of the 90s.

The position of companies and institutions in the forest industry on questions of social equity
can substantially affect their ability to act in partnership, their ability to connect in terms of issues
and programmes (and hence their political weight), and possibly even their ability to survive.
The strategy for sustainable development for the diverse and often conflict-laden claims on
forest management is again:
negotiation instead of filtering.

The most important issue in social equity is combating poverty. This was the central issue of the
Rio conference. Agenda 21 starts with an entire chapter devoted to it, as poverty is seen as the
main obstacle to sustainable development. In 1996 1.2 billion people - one quarter of the popu-
lation of the developing countries - had low incomes, i.e. less than USD 1 per capita per day
available (BMZ 2000: 207). Poverty is the cause and result of inequitable access to resources,
information and decision-making, inequitable distribution of opportunities and risks, revenue and
costs, and inequitable forms of exercising power and resolving conflicts. The importance of
poverty as the main obstacle to sustainable development was also presented at the Johannes-
burg conference Rio+10, and the first global goal for the new millennium is to halve the number
of those living in poverty by 2015 (UNDP 2003: 1).

The forest industry plays a special role in combating poverty (ARNOLD 2002). Two circum-
stances are particularly responsible for this:
Very many poor people live in forest regions. Around one quarter of the poor people in the
world depend entirely or partly on forest resources (SCHERR / WHITE / KAIMOWITZ
2002). Every change in forest utilisation has direct impacts on the situation of the poor.
While transformation of forest into agricultural or livestock use often results in only a brief
upswing in the local economy, followed quickly by a collapse (cf. SCHNEIDER et al. 2000
on this „boom and bust“ phenomenon), forest management can create long term value and
reduce poverty. This can be done not only by creating jobs with fair payment, but also by
developing potential in addition to wood production (e.g. food or medical products) and
forms of use (e.g. tourism), and by taking into account the claims of not only owners and
their employees, but also other groups.

The partnership principle

Partnerships between states, key sectors in society and individuals are called for at many points
in the Rio documents, e.g. the Preamble and Principle 27 of the Rio Declaration (UNIVERSITY

70
Requirements for sustainable forest management
Dietrich Burger

FOR PEACE 2002: 58). Under the Rio paradigm, partnerships are a key feature of sustainable
development. Without partnership, the changes needed for sustainable development cannot be
achieved, and the changes achieved cannot be sustained.

WIELAND (1999: 13) notes that the globalised economy „demands the capability for coopera-
tion between organisations in the value chain. Global competitiveness requires global ability to
cooperate, and global ability to cooperate requires global competitiveness.” In the globalised
economy, production is increasingly a process of division of labour, which is itself increasingly
fragmented: raw materials and semi-manufactured goods often come from completely different
parts of the world, and production facilities near the consumer often only assemble the individ-
ual components and put a logo on the final product. The fragmentation of the production
process and the supply of different markets require a complex supply and trade network.
Besides productive and distributive functions, the value chain increasingly needs communica-
tive processes, e.g. advertising and consumer education. The globalised economy is accord-
ingly operating increasingly through complex productive, distributive and communicative
networks. An individual company cannot handle all the different functions in the value chain
competitively, and must act as a partner in the networks.

An additional factor is the redistribution of regulatory responsibilities under globalisation. The
nation state is increasingly becoming a service state, relinquishing regulatory functions which
are increasingly being handled by the private sector and civil society. The actors in sustainable
development are themselves participating in establishing the guiding framework, both to protect
their interests and to contribute their experience in the interests of appropriate decisions. The
individual actors accordingly have to operate not only in value chain networks, but also in
governance networks.

The goals and contents of partnerships and networks can change over time. Typical phases
are:
the information phase: partners only exchange information on issues of joint interest or their
own experience,
the communication phase: partners respond with feedback to the information received,
the cooperation phase: the goals and tasks are coordinated between partners on a case by
case basis,
the alliance phase: coordination of goals and tasks is done through long term and mostly
formal agreements.

Two features in particular are decisive for the success of partnerships and networks:

a clear and binding division of roles and functions between partners,
the partnership capability of members. In turn, four factors are decisive for this:
• the partners’ competence for the roles and functions they take on,
• the efficiency (and specifically the economic efficiency) with which functions are
performed; an inefficient partner can be a burden on the entire network,
• dialogue and communication capability, both within the network and outside,

71
Principles and rules of sustainable forest management

• the ethics of the partners, and specifically their attitude towards the principles of
sustainable development and their readiness to implement these. This last factor is
becoming increasingly important. One „black sheep” can be a hazard to the reputation
of an entire network.

Partnership capability is becoming an important asset, as it is a major factor in determining the
future viability of the company. This also applies (and particularly) to companies in the forest
industry. They have to be able to act as partners not only to other companies in the value chain,
but also to organisations in the governance networks with the ability to influence public opinion,
establish credibility and mobilise political support.

The coherence principle

The sustainable development paradigm provides guidance on how development can be
holistically approached. The first three principles provide orientation for content. The focus is
on the situations to be considered, showing the direction development should take. However, as
human ability to handle holistic perception, evaluation and structuring of complex situations is
limited, the paradigm offers two more principles for methodological orientation¸ showing how
the holistic demand of sustainable development can be handled despite the limitations. One
principle already cited reminds actors that they should not try to establish sustainable develop-
ment on their own, but should act in partnership.

The second methodological principle, that of coherence, is concerned with the limited range of
human action. Metaphorically speaking, it is based on the circumstance that thoughts and
hands differ in their reach, thus requiring to „act locally, think globally“ - i.e. thinking outside the
narrow range of action of the hands. This in turn meets the need to think beyond our own
backyard. The segment which we can and wish to shape needs to be seen in the context of
reality as a whole. It is important here to consider breaks and incompatibilities on the
boundaries of the segment to be shaped - along the backyard fence, as it were. In particular,
three types of break need to be watched:
Horizontal incoherence with neighbouring systems at the same level, e.g. between
agriculture and forestry. The conflicts arising out of such incoherence can possibly be
settled or reduced through reference to a shared paradigm at a higher level, e.g. regional
development.
Vertical incoherence between different levels, e.g. between decentralised units and head
office. To avoid decisions at the decentralised level conflicting with those at head office,
commitment to the subsidiarity principle can be helpful. This states that the higher level in
the hierarchy may only assume tasks which cannot be performed by lower levels. Besides
this ban on „recentralisation”, the subsidiarity principle also requires supporting the lower
level, ensuring that it has the appropriate environment (and specifically financial and legal
security) to develop.
Temporal incoherence is contradictions or breaks between past and future development.
Changes, and with them certain breaks, are inevitable if there is to be development. To
avoid dangerous breaks during the change process, three rules should be followed:

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Requirements for sustainable forest management
Dietrich Burger

• Innovations should be based on thorough analysis of past practice. This rule seems
trivial, but is often neglected, particularly for innovations in forest use: new processes
are often introduced because they seem more efficient in terms of marketable
products, without studying and understanding the ecological and social functions of
existing forest use, e.g. collecting food or medical products.
• Innovations should be conceived and communicated as further developments of
existing practice, making clear which technical, cultural, organisational or economic
elements are being retained and which replaced.
• Speed of innovation and speed of learning should be matched.

Applying the coherence principle requires three steps:

Possible breaks have to be perceived.
They must be evaluated to see if they represent a danger to sustainable development, or
whether they might cause frictions which release positive development energy (e.g.
stimulating rivalries).
Breaks may have to be smoothed over or bridged, with two basic possibilities:
• the subsystem to be shaped is adapted to the prevailing conditions (e.g. establish-
ments aligned with the legislative framework) or
• the conditions are altered in favour of the subsystem to be shaped (e.g. forest law
amended to favour the establishments).

Compliance with the coherence principle, i.e. the search for coherent integration of the subsys-
tems to be tackled into the overall system, is particularly important for the ability of companies
and organisations to survive.
Analysis and possible correction of breaks and incompatibilities with neighbouring systems
and with the environment generally are prerequisites for minimising frictions and hence
saving energy and costs.
Tracking developments outside the subsystem is a prerequisite for the ability of companies
and organisations to connect thematically and programmatically with the future topics
and political programmes which dominate political discussion in their environment.
Naturally, this does not mean that forestry companies and organisations should respond to
every new issue raised in the media. However, if companies isolate themselves, fail to be
aware of political discussion of fundamental future questions, and fail to take a position on
these, they run the risk that their potential for contributing to the solution of future problems
will not be perceived and honoured, and will cost them chances of new alliances and
support from society at large.

Sustainable forest management and freedom

Sustainable forest management is not compatible with the idiom „unable to see the wood for the
trees”. It does not permit a narrow focus, and requires a broad view and approach in dealing
with forests and associated resources.

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Sustainable forest management and freedom

This requirement is in clear contrast with the tendency towards the increasing focus on
„economism” as „the major ideology of the present day” (ULRICH 2002: 35).

This focuses very tightly on questions of efficiency in their narrowest sense, the valuation of
inputs and results in terms of the market. This creates the danger that outputs which are not
marketable and social and ecological aspects will not be appropriately considered in decision
making (cf. BURGER / MAYER 2003: 42 et seq.).

By contrast, the business ethicist ULRICH (2001: 204) emphasises that commerce means
„creating assets”, and that this is „not an end in itself but a means to a good life”. The life-con-
ducive aspect of business requires consideration of not just efficiency issues but also
questions of equity (who should assets be created for? how should the costs and benefits of
„rationalisation” be equitably divided?) and with questions of purpose (what assets should be
created for what lifestyle? how should productivity gains be meaningfully used?).

The life-conducive nature of sustainable forest management accordingly requires that efficiency
questions, whose central importance is not disputed in any way, should be combined with
questions about intergenerational equity and social equity. However, it is also necessary to ask
what lifestyle sustainable forest management is intended to serve. Lifestyles can be very
diverse in different societies and cultures. However, if we follow SEN (2000) in arguing that
development must mean an increase in freedom in all cultures and societies, then sustainable
forest management should be required to increase freedom from shortage of resources and
shortage of possibilities for participation, increasing opportunities, expanding freedom to shape
life, and reducing dependence on assumed material pressures. The five principles cited can
assist sustainable forest management’s ability to create or increase freedom, in other words
they are conducive to meaning.

Forest management which complies with the paradigm of sustainable development requires far
more comprehensive awareness of potential and opportunities and valuation of outputs and
claims along more dimensions (the social dimension in addition to the ecological and economic
ones) than forest sustainability alone. Sustainable forest management starts in the mind. To
find and follow the path of sustainability, forest management requires far-sighted and open-
minded operational and sectoral decision-makers. The present work aims to show how forest
certification can help in this.

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Requirements for sustainable forest management
Dietrich Burger

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76
Standards: pointing and paving the way
to sustainable forest management
From the tropical timber boycott to forest certification
Chris Elliott

From the tropical timber boycott to forest certification
Chris Elliott

The international forest ‘crisis’ of the 1980s

In an influential book published in the mid-1980s, MYERS made the link between international
consumption of tropical timber and deforestation:

„I remember seeing a tree being felled by a logger in a forest in Borneo...each day thousands of
such trees are cut in Borneo. Logging of any sort contributes to a pattern of depletion that may
leave little forest of any sort, except degraded fragments, in Southeast Asia by the start of the
next century...The consumerist demand by affluent people many thousands of kilometres away
from Borneo or Amazonia is a prime impulse behind the headlong rush of many nations that
have tropical hardwoods to harvest their hardwood timber at rates beyond which the forest can
renew it.” (MYERS 1984: 91-93)

Responding to this, international environmental non-governmental organisations (NGOs) began
making calls for boycotts of tropical timber, starting with Friends of the Earth in the United
Kingdom (UK) in 1984 (DUDLEY et al. 1995:109). Initially this led to bans on the use of tropical
timber in public constructions in various municipalities in Germany, Holland, the UK and the
United States of America (US) (ITTO 1992:17).

Threats to the world's forests had attracted increasing attention from the general public in
Western Europe and North America, the media and ‘policy-makers’ since the early 1980s and
led to a ‘crisis’ situation by the middle of the decade (WCED 1987: 2-4; POORE et al. 1989: 1).
The main issues were tropical deforestation, the loss of old-growth forests in temperate and
boreal zones, threats to forest biodiversity, and ecological functions and land rights of indige-
nous people. These subjects can be summarised (with the exception of the last one) under the
categories of deforestation and forest degradation.

According to data from the Food and Agriculture Organization of the United Nations (FAO),
forests covered about a quarter of the earth's land area in 1995, a total of 3,454 million hectares
(ha.). The average annual deforestation rate in the tropics during the 1980's was estimated to
be 15.4 million ha. (FAO 1995: 20), a compound annual rate of 0.8%. In 1997, FAO estimated
that the annual deforestation rate for the period 1990-1995 was somewhat lower: 13.7 million
ha. (FAO 1997b: 17)

FAO does not issue figures on forest degradation. However one study using satellite images
estimated that between 1986 and 1993, 19% of the world’s rainforest area was degraded
(JANG et al. 1996). In another study on Amazonia, the rates of degradation (from closed to
open forest), and fragmentation (from continuous to discontinuous forest), were estimated to be
3.8 million ha. per year between 1978 and 1988, twice the deforestation rate in the region
(SKOLE / TUCKER 1993).

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The international forest ‘crisis’ of the 1980s

Costs of deforestation and forest degradation are high. Research in the Amazon has indicated
that the potential present value of net revenue from the sale of non-timber forest products such
as fruits, bark and resins harvested from natural forests may be as high as US$ 2,380 per ha.
This is significantly higher than the revenue from alternative land uses in the region after defor-
estation, such as cattle ranching (GRIMES et al. 1994). Other research in the same region has
shown that undisturbed tropical rainforest in the Amazon is a net absorber of carbon dioxide
(GRACE et al. 1995) which gives forests added significance in the ongoing debate on measures
to mitigate climate change. Overall, FAO estimates that the annual contribution of forest prod-
ucts to the world economy is approximately US$ 400,000 million, and that forestry currently
provides subsistence and wage employment equivalent to 60 million work-years worldwide of
which 80% is in developing countries (FAO 1994: 3).

International policy responses

Degradation or deforestation of individual forest sites has been noted since antiquity (e.g.
MATHER 1990: 30-33). However, it has only been in the late 20th century that forest loss has
been perceived as a global problem. The initial focus of attention was tropical forests. One of
the first accounts was published by AUBRÉVILLE (AUBRÉVILLE 1938), but it was not until the
publication of several assessments of the status of tropical forests approximately twenty years
ago (SOMMER 1976; LANLY / CLÉMENT 1979; MYERS 1980; FAO 1982), that the need for
international action to conserve forests (i.e. to stop deforestation and forest degradation) was
widely accepted by governments and international institutions.

This led to a number of policy responses in the 1980s: the initiation of the Tropical Forestry
Action Plan (TFAP), in 1985, and the establishment of the International Tropical Timber Organi-
zation (ITTO) in 1986. These are primarily mechanisms for providing funding and technical
assistance to projects in developing countries, but also fora for discussing policy reforms in
these countries. The activities of TFAP, ITTO and other initiatives, involved an increase of
official development assistance for forestry from US$ 400 million per year in 1985, to more than
US $1,350 million per year in 1991 (FAO 1994: 16).

However, the increases in funding and political and media attention associated with TFAP and
ITTO had not lead to a reduction in deforestation rates by the early 1990s. This situation
resulted in calls from environmental NGOs for tropical timber boycotts, and also demands from
developed country governments for action from within FAO, United Nations Development
Programme (UNDP) and The World Bank, for reform of international collaboration to promote
forest conservation (e.g. CASSELS 1995; FAO 1994). The Director of the UNDP forestry
programme was quoted as saying:

„Deforestation is clearly out of control, certainly beyond the control of foresters, and we need
an urgent re-examination of all ongoing programmes and policies” (LANKESTER cited in
COLCHESTER / LOHMANN, 1990: i).

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From the tropical timber boycott to forest certification
Chris Elliott

Reform of international collaboration on forests was prominent on the agenda of the 1992
United Nations Conference on Environment and Development (UNCED), and in various
preparatory meetings and processes. After some controversy between developed and devel-
oping countries, UNCED produced a set of non-binding Forest Principles and Chapter 11 of
Agenda 21 (UNCED 1992a, 1992b) rather than the forest convention that many developed
countries had been promoting. Although this was disappointing to some, the ‘global consensus’
on forests represented by these two documents does have some significant features, which
have influenced subsequent discussions on forests. After UNCED, the UN Commission on
Sustainable Development (CSD) was created to monitor progress in implementing Agenda 21
and other agreements reached at UNCED. In 1995, the CSD established an Ad-Hoc Inter-
governmental Panel on Forests (IPF) to promote and review action at the national and interna-
tional level to implement UNCED decisions relating to forests, and in 1997 the International
Forum on Forests (IFF) was created to continue this work.

The emergence of forest certification

Labelling wood products with a mark of quality can be traced back in Europe to a French royal
decree of 1637, which stipulated that members of the guild of cabinet makers had to mark the
furniture they made. The label, which was a stamp marked on the wood, enabled members of
the guild to maintain a monopoly on the production of high quality furniture. It was therefore an
expression of the power of the guild. As such, it came under criticism and was abandoned after
the French revolution in 1789 (WATSON 1956).

In the 1990s under the name of ‘forest certification’, other forms of labelling wood have
emerged, with the objective of identifying products from well managed forests. The first certifi-
cation was carried out in Indonesia in November 1990 by the Smartwood programme of the
Rainforest Alliance, an NGO based in New York (CROSSLEY 1995: 36). Since then, certifica-
tion has developed rapidly, and by September 2004 over 40 million ha were certified under the
Forest Stewardship Council (FSC) scheme alone, and more than 100 million ha if all certification
schemes are included.

The rapid growth of certification was not without controversy. In March 1997, the Food and Agri-
culture Organization of the United Nations (FAO) stated that:

„Certification and the associated issue of labelling is one of the most topical and controversial
subjects in forestry at the present time. Certification seeks to link trade in forest products,
particularly international trade, to the sustainable management of the forest resource,
enabling those who so wish to purchase products coming from sustainably managed
forests.” (FAO 1997a: 1)

It is interesting to study controversial subjects. However, the interest of certification as a topic
lies not only in the controversies themselves, but in the actors and contexts involved. Forest
policy is traditionally seen as a branch of public policy, yet in certification we find cases of NGOs
and private sector actors taking the lead on issues rather than government forest departments.
In terms of context, national-level developments on certification cannot be understood without
reference to international timber markets and to the international forest policy debate. In short,

81
The emergence of forest certification

the development of certification can only be understood by reference to increasingly globalized
economies and to policy processes involving multiple actors and fora. These actors and
contexts are not only found in the case of forest certification. They are increasingly common in
other environmental and social issues, and a study of forest certification should yield some
lessons of wider applicability.

When certification was first discussed, the idea was that it should be implemented by interna-
tional organizations: in 1989, Friends of the Earth (FOE) (which had been actively promoting
tropical timber boycotts in the UK) and several other NGOs, supported by the UK government
proposed that the International Tropical Timber Organization (ITTO) carry out a project:

„studying the possibility of labelling timber, including both logs and manufactured wood
products, from tropical forests to indicate whether they came from forests managed for
sustainable production” (ITTO 1991: 3).

However, Malaysia, Indonesia and the Philippines expressed concerns that NGOs might call for
boycotts of timber which was not labelled, and the proposal was not accepted in its original
form. Instead, ITTO eventually carried out a broader study of the incentives required to promote
sustainable management of tropical forests (ITTO 1991).

In November 1992, the ITTO council meeting was the scene of vigorous criticism by Brazil,
Malaysia and Indonesia about an act on tropical timber labelling adopted by the Austrian
parliament in June 1992. This act made labelling of tropical timber imports obligatory in Austria,
and was seen by tropical timber producing countries as an unacceptable trade barrier
(RAMETSTEINER 1994). International pressure on Austria in ITTO and the threat of a formal
complaint to the General Agreement on Trade and Tariffs (GATT) led to a revision of the act in
1993.

In May 1994, ITTO published the first international report on the status of forest certification
(BAHARUDDIN / SIMULA 1994) and organized a working party meeting to discuss the issue.
The authors classified certification as a combined instrument of trade and environmental policy.
They described the international context in which certification was emerging as follows:

„There is a growing world-wide concern about environmental problems which is increasingly
affecting trade. Environmental concerns about timber are part of broader product-related
concerns of consumers in industrialized countries. These concerns are expected to continue
spreading in the future...Environmental concerns about timber and timber products are
limited to sustainability of forest management as part of the production process. The
concerns are shared by consumers (environmental impacts of the production process of the
products to be consumed), trade (market shares, company image) and industry (long-term
availability of timber)...There is no more debate on the ‘why and wherefore’ of conserving
eco-systems and forests and promoting economic development, albeit sustainable develop-
ment. Discussion has moved on to a matter of modalities...the adoption of Agreements on
Environment and Development at Rio de Janeiro in 1992 . ITTOs Target 2000...ITTO Guide-
lines...have provided the multilateral framework to minimize the differences between timber
producing and consuming countries”. (BAHARUDDIN / SIMULA 1994: vii and 2-3)

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From the tropical timber boycott to forest certification
Chris Elliott

BAHARUDDIN and SIMULA (1994) noted that the primary objectives of certification were to
improve forest management in order to achieve sustainability, and to ensure market access of
certified timber particularly in markets with high environmental awareness. They identified the
following general requirements for a viable certification system: credibility, coverage of all types
of timber, objective and measurable criteria, reliability, independence, voluntary participation,
non-discriminatory, acceptable to the parties involved, adaptability to local conditions, cost
effectiveness, transparency, goal-orientedness, and practicability.

The report noted that NGOs were broadly supportive of certification in 1994, whereas views in
the timber trade and industry varied from strong support to active opposition. Most governments
expressed tentative support for certification, albeit with a variety of reservations. Several impor-
tant tropical timber exporters, including Malaysia and Indonesia linked the implementation of
certification schemes to ITTOs Target 2000 and called for a delay, saying that certification
should be implemented by that date, rather than immediately. Only two countries (Brazil and
Congo) were definitely against certification. Canada, the US and Switzerland expressed support
for private-sector certification schemes. The report noted that certification alone was likely to be
a second-best instrument to achieve improved forest management and assured market access
and that its effectiveness would be enhanced if it was part of a policy package. The authors
concluded:

„In spite of the uncertainties related to the effectiveness and relevance of environmental
labelling as a policy instrument for conservation of natural resources, labelling is expected to
become more common, not least because of increasing demand for environmental informa-
tion on products by consumers, and the less discriminatory nature of labelling as a policy tool
compared to other instruments (e.g. product standards and regulations)”. (BAHARUDDIN /
SIMULA 1994: vii) .

Another study commissioned by ITTO (WADSWORTH / BOATENG 1996) concluded that
market demand for certified timber was strongest in Germany, the Netherlands, Belgium and
Austria, moderate in the US and UK and virtually non-existent in Japan and Korea. Even in the
countries with relatively high demand, interest was confined to certain parts of the market such
as the ‘do-it-yourself’ retail sector and the industrial joinery sector. The study concluded that
there was little willingness among consumers to pay more for certified products but noted that
the market for certified timber was not simply a niche one, particularly as certification began to
be applied to temperate forests as well as tropical ones. The study does not suggest why the
market demand for certified timber is strongest in the ecosensitive countries listed above but it
can be noted that they are all democratic countries with active NGOs and green political parties
working on forest conservation issues. These NGOs and political parties have mobilised public
opinion on forest conservation issues and sometimes succeeded in placing them on the public
policy agenda.

It can be seen that a number of fundamental building blocks for certification programmes were
developed under the auspices of ITTO, partly in response to pressure from international NGOs
such as FOE and World Wide Fund for Nature (WWF). ITTO also played a role as a forum for
international discussions on certification. However these NGOs gradually became disenchanted
with ITTOs perceived vacillation on labelling and began to pursue initiatives outside ITTO.

83
The emergence of forest certification

In November 1991, WWF produced a position paper which included the following comment:

„Meanwhile, because of ITTO’s inertia, conservation NGOs, including WWF, are working
directly with the timber trade on incentives and labelling...WWF is helping establish a credible
independent labelling scheme that gives consumers a choice. A group of small-scale traders
and several environmental groups - the Forest Stewardship Council - is working on the
scheme details...in short, a labelling scheme for wood products is developing, leaving the
ITTO behind” (ELLIOTT / SULLIVAN 1991: 5-6).

In a detailed analysis of ITTO, GALE (1996) concludes that a tacit alliance was formed between
producer and consumer government coalitions and the tropical timber industry to block the
negotiation of norms, procedures and compliance mechanisms needed to institute a sustainable
tropical timber trade regime, and that in consequence environmental NGOs largely abandoned
ITTO as a forum. On certification he notes:

„The reluctance of governments to negotiate a certification and labelling scheme under the
auspices of the ITTO stemmed from a number of considerations, including doubts about
such schemes technical feasibility, cost, GATT compatibility and industry resistance. On the
other hand, certification was the mildest of the negative compliance measures suggested
(which included bans, boycotts, tariff increases, voluntary export restraints, quotas and
levies). By failing to move forward on certification and labelling, governments signalled their
intention to create a minimally-effective Tropical Timber Trade Regime that ensured that few
consequences and no costs would result from a failure to implement its provisions”. (GALE
1996: 397).

In summary, international initiatives such as TFAP and ITTO had not made a visible impact on
global or regional deforestation rates by the late 1980s, and were criticized in consequence,
particularly by NGOs. Before UNCED, there were therefore calls from some governments,
development aid agencies and NGOs for reform of these international initiatives, but no major
changes were made. In addition, in the late 1980s, there was an increased interest by policy
analysts and intergovernmental organizations like the Organization for Economic Co-operation
and Development (OECD) in the use of economic incentives for improving natural resource
management (OECD 1989) and in environmental labelling (OECD 1991). The relationship
between trade and the environment was also becoming an international policy issue. It was in
this context that forest certification emerged in the early 1990s as a policy instrument initially
promoted by conservation NGOs, to address the problems of deforestation and forest degrada-
tion.

These NGOs were able to marshall the technical, political and financial resources to support
certification in general, and the FSC in particular:

„The experience on FSC shows that an international NGO-based initiative can lead to
important development work both within and outside the organization, significant to the
extent that it had prompted similar initiatives, national and regional, as alternatives to FSC’s.
FSC’s concept was designed by NGOs, probably with small market shares targeted initially.”
(BAHARUDDIN / SIMULA 1997: 14)

84
From the tropical timber boycott to forest certification
Chris Elliott

This quote suggests that NGOs had both a direct influence in promoting FSC, and then as a
result of this a (probably unintended) indirect influence on the development of other certification
programmes which developed as a response to FSC. The fact that NGOs such as WWF, FOE,
the Global Forest Policy Project and Greenpeace had the capacity to support FSC is one of the
elements which has contributed to the development of certification. It can be argued that by the
early 1990's several international NGOs working on forest policy found themselves in a position
to promote certification for two main reasons.

First, a number of these NGOs had sought to integrate conservation and development perspec-
tives in their policy proposals. One of the first presentations of the concept of sustainable devel-
opment can be found in the World Conservation Strategy published by IUCN (The World
Conservation Union, formerly known as the International Union for the Conservation of Nature),
UNEP (United Nations Environment Programme) and WWF in 1980 (IUCN 1980). A number of
the ideas from this Strategy were taken up in the World Commission on Environment and
Development (WCED) report (WCED 1987: 43). Certification was identified as a tool to achieve
the conservation and sustainable development of forests in the second edition of the World
Conservation Strategy, published before UNCED in 1991. At the same time the Strategy
questioned the effectiveness of tropical timber boycotts which had been promoted by a number
of NGOs in the 1980s:

„An important part of the strategy to save tropical forests is to increase the economic benefit
for forest nations and communities from using forests rather than converting them to
farmland. We therefore need a strong, sustainable tropical timber industry. Economic incen-
tives are needed to build up trade based on sustainably managed forests. A comprehensive
package of measures is needed to make trade conditional on sustainability. These would
include systems of certification and management with provision for monitoring and financial
support for their implementation. Lower-income countries may require assistance to meet
criteria...Buying tropical veneers and other valuable tropical hardwood products that have
been produced sustainably would encourage maintenance and even improvement of selec-
tive wood extraction. Blanket boycotts of tropical timber are likely to favour forest clearance
for low-grade shifting cultivation, because they remove economic incentives to keep even
modified forests” (IUCN 1991: 132-133)1.

In summary, after the WCED and UNCED sustainable development has been recognized by
governments as an objective of the emerging international forest regime. To the extent that
forest certification could be presented (as it is in the quote above) as a tool to achieve this
objective, it is likely to have had more legitimacy with governments than if it had been presented
in isolation. This was important because the main funding source for FSC was governments. It
also provided a basis for collaboration with retailers through buyers groups. These groups have
been seen by some analysts as NGO/business partnerships with the objective of achieving
sustainable development (MURPHY 1996). Similarly, the sustainable development concept and
the recognition of the need for a sustainable timber industry, provided a platform for dialogue
and co-operation with forest companies such as AssiDomän in Sweden who have been suppor-
tive of certification. Co-operation with these private sector actors certainly increased the policy
influence of NGOs in some countries.

85
The emergence of forest certification

These NGOs had experienced significant increases in their staffing and income in the 1980s
which gave them the technical and financial resources to contribute to the development of forest
certification. For example, WWF’s total income world-wide increased from US$50 million in
1985 to US$250 million in 1995. During the same period, the staff of WWF International
increased from approximately 50 to over 140 (WWF 1996). Similarly, FOE-UK had an income of
£10,000 in 1971, £206,000 in 1981 and £5.3 million in 1995 (LOWE / GOYDER 1983, THE
INDEPENDENT 1996).

In addition to NGO support another element which has contributed to the development of certi-
fication programmes is the set of international processes on criteria and indicators. Documents
from these Criteria and Indicator processes have contributed directly to the development of
certification standards in several countries, even though the relationship between Criteria and
Indicators and certification has sometimes been the subject of controversy. There may have
also been indirect contributions from the numerous discussions and publications on Criteria and
Indicators and sustainable forest management.

It is interesting to note that while the Criteria and Indicators and certification processes have
influenced each other they have been supported by different actors (mostly NGOs and private
sector actors for certification, mostly governments for Criteria and Indicators). In consequence,
they have evolved in different ways. The post-UNCED Criteria and Indicators processes had
their origin in agreements between governments at UNCED which were expressed in the Forest
Principles and Agenda 21. International consensus on the need for Criteria and Indicators led to
their development. Certification developed in a converse manner with programmes developing
first and international discussions at IPF and the intersessional meetings to some degree trying
to catch up with events.

A third element contributing to the development of certification was the increasing interest in
parts of the private sector for sustainable development. For example the statements and activi-
ties of the Business Council for Sustainable Development (BCSD, later renamed the World
Business Council for Sustainable Development, WBCSD) show that by 1992 a number of
business leaders from large national and international corporations had expressed support for
sustainable development:

„Business will play a vital role in the future health of this planet. As business leaders, we are
committed to sustainable development, to meeting the needs of the present without
compromising the welfare of future generations... New forms of cooperation between
government, business, and society are required to achieve this goal” (Declaration of the
BCSD signed by 48 business leaders cited in SCHMIDHEINY 1992: xi)

The concept of sustainable development has been subject to a variety of interpretations and the
BCSD’s interpretation with a focus on economic growth was not the same as that of IUCN,
WWF and UNEP in the second edition of the World Conservation Strategy (IUCN 1991). How-
ever, what should be noted is that a number of influential business leaders had the technical
and political capacity to promote an alternative approach to certification, also within the frame-
work of sustainable development.

86
From the tropical timber boycott to forest certification
Chris Elliott

Other elements which have influenced the development of certification are the evolution of
ecolabelling and the increased use of economic instruments for environmental protection. It is
not possible to establish any causal links between these developments, but it is likely that these
trends provided a favourable environment for the development of certification programmes.

Last but not least, the other significant influences which have affected the development of certi-
fication schemes and will continue to do so in future, are the the creation of the World Trade
Organization (WTO), the signature of the Agreement on Technical Barriers to Trade (TBT) and
the adoption of International Organization for Standardization (ISO) standards 14001 and 14020
on environmental management. The TBT Agreement is likely to influence all ecolabelling
programmes. They will increasingly have to demonstrate that their standards are based on the
best available information and developed through a stakeholder process, if they are to avoid
being considered a trade barrier. The agreement focuses on governmental ecolabelling
programmes but will also set a benchmark for non-governmental programmes. ISO has
provided a forum and mechanism for the development of system-based certification, and is
closely linked to WTO. This will provide additional support for a systems-based approach to
certification rather than one based on performance standards.

87
Notes

Notes
1
Although the Strategy referred to tropical forests, the adoption of a global approach to forests at
UNCED by governments was followed by NGOs, so these recommendations have come de facto to
apply to all types of forests.

References

AUBRÉVILLE, A. (1938): La Forêt Coloniale; Les Forêts de l'Afrique Occidentale Française.
Ann. Acad. Sci., Colon, 9, 1-245.

BAHARUDDIN, H. G. / SIMULA, M. (1994): Certification Schemes for all Timber and Timber
Products. Report for the International Tropical Timber Organization, Yokohama, Japan.

BAHARUDDIN, H. G. / SIMULA, M. (1997): Timber Certification: Issues and Progress. Report
for the International Tropical Timber Organization, Yokohama, Japan.

CASSELS, D. (1995): Considerations for Effective International Co-operation in Tropical Forest
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COLCHESTER, M. / LOHMANN, L. (1990): The Tropical Forestry Action Plan: What Progress?
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CROSSLEY, R. (1995): A Review of Global Forest Management Certification Initiatives;
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Columbia/Agricultural University of Malaysia Conference on Certification in May 1996, Kuala
Lumpur.

DUDLEY, N. et al. (1995): Bad Harvest. Earthscan, London.

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Development, FAO, Rome.

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MATHER, A.S. (1990): Global Forest Resources. Belhaven, London.

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90
Standards: flexible and practical aids to communication
Dietrich Burger

Standards: flexible and practical aids to communication
Dietrich Burger

Sustainable forest use and communication

A wide range of different actors is involved in sustainable forest management, e.g. forest
owners, employees, neighbouring residents, suppliers, customers, officials, associations,
environmental and social organisations (to name just a few important examples). These actors
communicate with each other verbally and through other signals, react and influence each
other. Sometimes they communicate directly, sometimes indirectly through other actors.
Sustainable forest management accordingly involves a complex communications network.
Disruptions in communication can cause problems for the sustainability of forest management,
e.g. if forest workers do not understand which trees are to be left during felling, or if manage-
ment misunderstands market signals and offers wood types for which there is no demand.

The complexity extends beyond the actors’ communications network to the individual acts of
communication. Each communication - intentionally or otherwise - conveys an entire package
of messages (SCHULZ von THUN 1990): besides the material information, the originators
always convey information about themselves (disclosure - „Whenever I say anything, I say
something about myself”). The communication also contains a message about what the sender
thinks of the recipient, and their relationship. Finally, almost all communications try to influence
the recipient - they contain an appeal This bundle of messages which is contained in every
communication is shown in figure 1.

Figure 1: The four sides (aspects) of a communication (SCHULZ von THUN 1990: 30)

material content

sender disclosure communication appeal recipient

relationship

To understand communication in the field of sustainable forest management, the lesson from
communications psychology that a communication involves not just the material content but
also an entire package of messages is very important. The material content can be illustrated
using the example of music: a violin can generate a note with a specific pitch or frequency; a
note with the same pitch can be played on a trumpet, but the sound is completely different,
because violin and trumpet have very different sets of overtones accompanying the funda-
mental note. The fundamental notes of the melodies in a Beethoven symphony can be played

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Sustainable forest use and communication

on a recorder. However, nobody would dream of substituting a recorder for the symphony
orchestra. The material content of a communication or statement can be compared with the
fundamental note, and the package of messages communicated with the sound of the note.

Whether a statement is understood or appears credible and whether its appeal is successful
depends not only on its material content, but also - and sometimes even more - on the other
components of the message, i.e. who is making the statement, what the recipient knows, learns
and feels about them, whether the statement succeeds in creating a relationship between the
recipient and sender, and whether the appeal speaks to the recipient and the recipient is able
to respond to it. Experts are often trained to formulate or evaluate the material content of
statements. Most of them are less familiar with the other components of communication. As a
result, they are often surprised when the correct material content fails to have the expected
effect.

Besides the complexity of the communication network and the diversity of the messages
transmitted with each communication, communication in and about sustainable forest
management is also often complicated by the fact that influential actors (e.g. in the added value
chain from the forest to articulate consumers) are often remote from each other, and occasion-
ally live in different language areas and cultures. Abandoning communication because of its
many difficulties is not an option, since - as WATZLAWICK and BEAVEN (1969) note - it is
impossible not to communicate. We communicate even when we are silent, e.g. through body
language. There is always communication, although it can be significantly disrupted and lead to
misunderstandings. This is why it is important to make use of aids to communication.
Standards are examples of such communication aids.

The following pages look at standards and their functions in assisting communication. Initiatives
to develop and implement standards can follow different approaches. There will accordingly
also be a review of important characteristics of standards initiatives covering the standards
themselves and their formulation, and also the features of conformity testing, which may lead to
a conformity declaration (e.g. a certificate), in other words a declaration that certain standards
have been met. Finally, one of the important characteristics of standards initiatives is how
testers are licensed or accredited, and by whom. All these processes are concerned primarily
with securing the material content of conformity declarations against misunderstandings, and
making them as unambiguous as possible. However, for unambiguous conformity declarations
to lead actors to reward such forest management, effective implementation strategies are
needed. These go beyond the material information that certain standards were complied with
and operate forcefully through appeals, through disclosure by the groups behind the standard
initiatives, and through the creation of relationships with the target groups for the strategy.

The review of the wealth of possibilities for configuring standards initiatives is followed by a
discussion of the important features of certification systems as a specific kind of standards
initiative. Overall, the present paper is intended to lay a foundation for the presentation of
individual certification systems in the following papers.

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Standards: characteristics and functions

Standards are widely used in international trade, particularly where prices are agreed for goods
without the possibility of inspecting and testing them. Prices are agreed for clearly specifiable
standards, i.e. quality types or classes, possibly before the goods are even produced or
harvested (e.g. future exchanges for grain, cotton, coffee). Standards such as the DIN German
industrial standards also play a major role in mass production. Suppliers have to meet specific
standards so that the supplied parts can be assembled. Generally, standards can be defined as
clearly specified quality characteristics. The International Organization for Standardization
(ISO) also requires standards to be the result of a process of consensus and to be approved by
a recognised body: „A standard is a document, established by consensus and approved by a
recognized body, that provides, for common and repeated use, rules, guidelines or
characteristics for activities or their results, aimed at the achievement of the optimum degree of
order in a given context.” (ISO / IEC 1991, Definition 3.2)

For a standard to specify unambiguous characteristics, it must also show characteristics of
clearly specified aims (cf. HEINEN 1966).
The embodiment of the characteristics to be tested is unambiguously defined: if
products are required to possess these characteristics (product standards), it must be
clear whether the characteristics must be identifiable in all stages of the product’s
development or processing, or only in specific ones; if processes are required to possess
these characteristics (process standards), it is necessary to define whether compliance
with the standard is required for the overall process or just individual phases. If a wood
product is accompanied by a declaration that the wood was produced in compliance with
certain standards of socially and environmentally acceptable forest management, this
involves a process standard which simply makes a statement about the process by which
the product was made, and not about the quality of the product itself. The declaration does
not show whether or not the wood contains residuals of substances injurious to health as a
result of its processing.
The features must be defined in terms of quality, rules for measurement and value. This
can be illustrated by considering the human feature of height. The quality of this feature is
not unambiguous, as a person’s size can mean a lot of things; it is only after we add the
rule that size is measured as height that the feature’s quality is uniquely defined. It seems
trivial to require that height be measured „from the top of the skull to the sole of the feet”.
However, measurement rules are by no means obvious for many features. Without them,
the feature is often not uniquely specified. The value of the feature shows the height or
required height of a person, i.e. 1.83 m. Values can be measured on different scales. This
may be nominal (yes, no), ordinal (e.g. large, medium, small) or cardinal (numerical values).
Target features can be given as absolute values, relative values (>X; <Y) or extreme values
(maximum, minimum). Certification standards often use criteria which usually state quality
and measurement rules for the feature to be tested, and indicators describing the required
values of the features. If a standard for a feature specifies a limit (maximum or minimum)
which must be satisfied, it is frequently described as a performance standard. By contrast,
management system standards do not set limits, but instead require proof that the
management system is working towards improving the relevant feature. Well-known ISO

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Standards: characteristics and functions

standards such as the Environmental Management System (EMS) standard ISO 14001 are
management system standards. As a result, they can only be used to describe a company,
and not a process or product (BASS 1998: 13).
The reference period for a feature shows whether the feature is required to be present
continuously, or during a specified period only.

Standards often appear unambiguous at first reading, particularly where the actors affected
jointly agree targets. However, closer reading frequently reveals a lack of precision or weaken-
ing clauses which show that the non-ambiguity is only apparent. Weakening expressions
frequently encountered are „substantially”, „where possible”, „as soon as possible” or simply
the omission of any required period.

Standards can perform a wide range of very different functions:
Aids to learning and innovation: learning in the sense of a permanent improvement in
behaviour is only possible if a measurement rule and desired values (e.g. a „yardstick”) are
available to allow evaluation of actual behaviour. Innovations can only be tested and
developed further if it is possible to establish whether they are moving towards or away
from the target value.
Preventing technical disruption: if a facility procures replacement parts which do not
comply with the standard, this can result in technical disruptions because the replacement
parts cannot be incorporated or do not have the expected durability.
Control instrument: it is only possible to establish whether specifications are met if they
are formulated in a way which is unambiguously measurable.
Management instrument: the most important function of management is to provide
guidance for employees. Specifying or negotiating clearly measurable performance is
essential for this (Management By Objectives).
Assisting internal communication and motivation: unambiguous agreements facilitate
internal communication, and goals with clear relevance to social values (such as
sustainable development) boost employee motivation.
Assistance to communication with business associates and customers: unambigu-
ously formulated standards and doubt-free testing make it easier for customers and
business associates to obtain information about a company’s values and policies, i.e. what
it stands for and what can be expected of it.
Reduction in transaction costs: the costs of obtaining information when entering into
agreements can be significantly reduced if unambiguously defined standards are agreed
with no margin for doubt and can be checked.

In many cases, standards perform several functions at the same time. For example, introducing
certain forest management standards can convey the message to customers that the wood from
the company was grown and harvested in a way which is socially fair and environmentally
acceptable, and also provide evidence to official agencies that legal norms were complied with.
They can also improve employee orientation and motivation.

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In all these functions, standards help make communication unambiguous and avoid misunder-
standings. Standards are, however, only aids to communication. They cannot communicate
themselves, and have to be correctly used in communication processes. Depending on the
individual cultural background, the requirements and effects of communication using standards
can differ widely. Certain modes of behaviour may seem a matter of course to people belonging
to the same culture, while the same standard may need to be spelled out and explained to
outsiders.

Options for designing standards initiatives

The institutions working on developing and using standards as communication aids are very
different in nature, operating in a wide range of fields with highly diverse goals and methods. All
these are covered here by the term standards initiatives. The term is deliberately defined
broadly. It is intended to cover statutory initiatives, such as the European Union (EU) regulation
on organic produce, certification systems like the Forest Stewardship Council (FSC), as well as
voluntary commitments by companies to specific standards, like the Global Compact proposed
by UN Secretary General Kofi Annan, or standards established and monitored by the
companies themselves, such as those the retail chain C&A requires its suppliers to comply with.

Standards initiatives can take a very wide range of forms, differing not only in terms of the
standards used, but also often in how the standards arose, whether and how compliance with
them is checked, and by whom (conformity testing), how testers are licensed (accredited) and
by whom, and finally how compliance with standards is rewarded or non-compliance penalised,
and by whom. Standards initiatives accordingly display a wide range of features which can take
very different forms (cf. fig. 2). When comparing standards initiatives - e.g. for the possibility of
mutual recognition - it is very important to compare the full range of features, including both
those intended or announced by the standards initiatives and those actually observed.

Given the wide range of possible forms standards initiatives can take in terms of formulation of
standards, conformity verification, accreditation and implementation, the impression could arise
that design is arbitrary. However, this would be wrong, as international conventions and
agreements and also (and particularly) the ISO have drawn up numerous rules for specific
features of standards initiatives, e.g. that standards must be formulated in a participative and
consensual manner. These rules are not binding, and standards initiatives cannot be forced to
comply. However, any initiative which fails to follow such generally accepted rules is in danger
of being refused mutual recognition by other initiatives, being dismissed by the public as lacking
credibility, or being classified as a trade barrier by the World Trade Organization (WTO).

VALLEJO / HAUSELMANN (2000) compiled these international rules with specific reference to
the field of forestry under a contract from the GTZ Forest Certification Project. Based on this,
and with the participation of the two authors, NUSSBAUM et al. (2001) expanded the review of
the basic rules for standards initiatives.

The review in fig. 2 of the features of standards initiatives is taken from the publication by
BURGER / MAYER (2003). This also looks at the individual features. The following section only
considers the features which are particularly typical of certification systems.

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Options for designing standards initiatives

An important key features of standards initiatives is the participation of those affected and
interested parties in both formulating the standards and conformity testing. This includes not
only whether there is participation, but also (and particularly) how this is handled. Participation
can be interpreted in very different ways, from mere presence at decision-making or hearings
through to codetermination. Interest groups are unlikely to feel they are genuinely participating
if the approach follows the line „invite, inform, ignore”. Participation requires not only the will but
also the capability. Particularly where interest groups from different cultures are to be included,
there may be problems with intercultural dialogue (from the modalities of the invitation through
language to the premises) which complicate or prevent participation. Another point that
requires careful consideration is whether there is adequate participation by affected parties if
their interests are being represented by international organisations. How far is it necessary and
possible to require that participants should themselves participate in drawing up the rules for
participation?

In connection with the current debate over measures against illegal logging, the question arises
whether existing certification systems can serve as effective or even adequate instruments. It is
important here to distinguish carefully between two features from the category „Formulation
and nature of standards” (cf. fig. 2): legality, i.e. whether the standards require compliance with
legally binding norms, and legitimation, i.e. whether the standards correspond with generally
accepted rules of behaviour, and were not drawn up arbitrarily or on the basis of a very specific
value system, and whether internationally accepted rules were observed for formulation.

In the standards of most forest certification systems legality is ensured by the requirement of
compliance with national laws and regulations. This establishes that forest certification is
complementary to rather than competing with national forestry policy. Complementarity may
mean that forest certification provides a control mechanism which supplements and reduces
the burden on national controls, or it may also mean that the standard establishes rules which
go beyond the limits of legality, so that its legitimation needs clarification.

Legality of forest certification becomes a problem where the formal law of a country does not
coincide with the population’s sense of right, i.e. where legality and legitimation conflict. Forest
certification runs into such conflicts e.g. where companies seeking certification use forest
resources under rights transferred to them under the formal legal system, but in which other
social groups claim use rights under traditional law. KAIMOWITZ (2004) recently drew attention
to this kind of conflict.

Various interstatal bodies (e.g. meetings of G7 (Group of the seven major industrial countries),
European Union (EU) Parliament and Council of Ministers and the International Tropical Timber
Organization (ITTO)) are currently looking for ways to suppress trade in wood from illegal
sources. It is conceivable that greater use could be made of existing forest certification systems
for this, or new certification systems could be developed which restrict themselves to
documenting legality. The Danish government chose the first approach when it decided in 2001
to accept FSC certification as evidence of the legality of wood production (EBA’A / SIMULA
2002). It remains to be seen whether this is sufficient to suppress the trade in wood from illegal
sources.

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Figure 2: Features of standards initiatives (source: BURGER / MAYER 2003)

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Options for designing standards initiatives

Standards of forest certification systems require legal action, but are not themselves laws.
Compliance with a specific standard is a voluntary decision. However, once this decision has
been taken and documented through the use of the corresponding logo, compliance with the
standard is binding (i.e. no longer voluntary).

The legitimation of the standards of forest certification systems is mostly based on interna-
tional or intergovernmental decisions and agreements. The legitimation of the FSC standard
and the national standards recognised by the FSC is based on the resolutions of the 1992 UN
Conference on the Environment and Development in Rio de Janeiro. The legitimation of the
standards approved by the PEFC (Programme for the Endorsement of Forest Certification
schemes, formerly Pan European Forest Certification) is based on the resolutions of the
Ministerial Conferences on the Protection of Forests in Europe in Helsinki (1993) and Lisbon
(1998). The first standards for sustainable forest management were published by the ITTO
(1989). However, these were originally intended only as a basis for member countries’ reports
to the ITTO. Their formulation was not sufficiently operational for conformity verification as part
of certification or for other purposes. Commissioned by the GTZ Forest Certification Project,
APPANAH and KLEINE (2001) wrote guidelines for formulating local conformity testing
procedures based on the ITTO criteria and indicators. On behalf of the ITTO Council,
BAHARUDDIN and SIMULA (2000) used an early version of this work to draft guidelines for
ITTO member countries to develop locally appropriate procedures for conformity testing based
on ITTO criteria and indicators.

Another key feature of standards for forest certification systems is their meaningfulness. This
means that it is clear which values a standard is aimed at. A standard aimed at short-term profit
maximisation will involve other rules than one aimed at sustainable development. However, a
purely verbal commitment to specific values in standards is not sufficient evidence of the
meaningfulness of the certification system. What values a standard is aimed at is something
which only becomes apparent in combination with the rigour and procedures for conformity
testing. For standards intended as communication aids, meaningfulness is very important: it is
necessary both to communicate to producers why it makes sense to follow a particular
standard, and to explain to customers and other stakeholders why it makes sense to reward
production processes which comply with the specific standard by buying products or in some
other way.

Certification: a specific type of standards initiative

Certification states that independent testers confirm compliance with specific standards with a
certificate. Declarations by the producers about their products (e.g. „the wood was naturally
grown”) should not be regarded as certificates. The standards which the certificate confirms
have been complied with can cover a very wide range, and should be specified. The statement
„the product was manufactured to the highest quality standards” is meaningless unless the
standard is cited. Certificates can also be used for very different purposes. The fact that forest
certificates were mainly developed as a means of communication in the market should not be
taken as implying that certification is exclusively a marketing instrument. The information
conveyed in the certificate can be used not only for communicating with customers, but also to

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Dietrich Burger

demonstrate to insurance companies, banks, officials and stakeholders (i.e. interest groups of
all kinds including environmental and social organisations) that a company is complying with
specific standards of environmentally and socially acceptable forest management (forest
management certificate), or that a processing or marketing establishment is following specific
rules regarding evidence of origin (value chain or chain of custody certificate).

Forest certification can make standards developed by actors who are not democratically
empowered to issue legally binding norms „customary commercial practice“. It is easy to regard
the groups which support and advance the certification system as self-appointed legislators.

In the context of forest certification, conformity testing is always performed by external testers.
It is difficult for outsiders to judge how independent they actually are, and whether the testing is
competently and appropriately done, as conformity testing can differ widely depending on the
local circumstances and possibilities. A key feature of conformity testing is transparency, i.e.
how easy it is in a specific instance for those directly and indirectly affected (including the
general public) to get an idea of the appropriateness of conformity testing and its implications,
particularly official requirements and the award or denial of a certificate.

In describing and comparing certification systems, a lot of attention is rightly paid to the
standards, conformity testing and accreditation of testers. It is, however, surprising that virtually
no attention is paid to implementation strategies. This is all the more surprising because this
category contains the features which account for the greatest differences between certification
systems, particularly since differences between standards, conformity testing and accreditation
are steadily decreasing. The features of the implementation strategies are also most likely to be
crucial in determining the acceptance and future viability of certification systems.

The implementation strategy displays the communicative quality of a certification system
particularly clearly. On the one hand there is the task of convincing producers to show compli-
ance with a specific certification system, and on the other hand there is the task of persuading
actors to reward the benefits which they obtain directly or indirectly from producer compliance
with standards. This communication conveys not only material information and an appeal, but
also carries relationship messages (cf. fig. 1) by raising the prospect of aid for conversion or
incentives or sanctions (cf. fig. 2). The other decisive factor here is the disclosure by the
promoters of the certification system. With their credibility and communicative competence,
non-governmental organisations (NGOs) can play a decisive role in the effectiveness of the
implementation strategy of a certification system, and so contribute to its viability.

The material information in communication with producers involves first the comprehensible
presentation of the rules with which the production process has to comply, second the explana-
tion of the requirements producers need to meet for conformity testing, and third the presenta-
tion of the direct and indirect benefits to them of conformity with the standards.

The material information of communication with the actors to whom the appeal is directed
about rewarding production which complies with the standards is that it explains to the actors in
their language and with their logic what the specific benefits of production in compliance with
standards are, and why they should support these standards. These quality declarations are

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Certification: a specific type of standards initiative

accordingly translations of the conformity declaration (certificate) from the language of produc-
ers into the language of the target groups at which the appeal is aimed. Such a quality declara-
tion to insurance companies would e.g. show that the risk of accidents, environmental damage
and possible social unrest is less for establishments certified by a specific system than for
uncertified establishments, and accordingly appeal for giving such certified establishments
preferential treatment. For banks, the quality declaration could mean how far compliance with
standards helps reduce the economic risk of the certified establishment. The appeal to the
banks would be to offer such producers better terms on loans.

Forest certification is definitely with us for the foreseeable future. Given the short track record
of the current certification systems - FSC, the pioneer, recently celebrated its tenth anniversary
- we can expect that all the current systems will continue to develop and to change. Possibly,
the greatest changes that can be expected will be in the field of implementation strategies for
forest certification systems.

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Dietrich Burger

References

APPANAH, S. / KLEINE, M. (2001): Auditing of Sustainable Forest Management A practical
guide for developing local auditing systems based on ITTO's Criteria and Indicators. Bangkok.

BAHARUDDIN, H.G. / SIMULA, M. (2000): Framework for an Auditing System for ITTO's
Criteria and Indicators for Sustainable Forest Management. Draft ITTC XXIX/16, Yokohama

BASS, S. (1998): Forest Certification - The Debate about Standards. Rural Development
Forestry Network, network paper 23b, odi, London

BURGER, D. / MAYER, C. (2003): Making Sustainable Development a Reality: the Role of
Social and Ecological Standards. GTZ Programme Office for Social and Ecological Standards,
Eschborn.

EBA'A ATYI, R. / SIMULA, M. (2002): Forest certification: pending challenges for tropical
timber. ITTO Technical Series No 19, Yokohama

HEINEN, E. (1966): Das Zielsystem der Unternehmung. Wiesbaden

ISO / IEC (1991): ISO / IEC Guide 2 - General terms and their definitions concerning
standardisation and related activities, Geneva

ITTO (1989): Criteria and Indicators for Sustainable Management of Natural Tropical Forests.
Yokohama

KAIMOWITZ, D. (2004): FSC Anniversary (presentation at the FSC tenth anniversary celebra-
tions), Bonn

NUSSBAUM, R. / JENNINGS, S. / GARFORTH, M. (2002): Assessing Forest Certification
Schemes: a practical guide. ProForest, Oxford

SCHULZ von THUN, F. (1981): Miteinander reden 1, Störungen und Klärungen, Allgemeine
Psychologie der Kommunikation. Hamburg.

VALLEJO, N. / HAUSELMANN, P. (2000): Institutional Requirements for Forest Certification.
A Manual for Stakeholders. GTZ Forest Certification Project Working Paper 2, Eschborn.

WATZLAWICK, P. / BEAVEN, J.H. (1969): Menschliche Kommunikation. Bern, Stuttgart

101
Forest Stewardship Council
Heiko Liedeker / Michael Spencer

Forest Stewardship Council
Heiko Liedeker / Michael Spencer

More than 10 years after its birth in the wake of the Rio Earth Summit, the Forest Stewardship
Council (FSC) remains a unique tool for driving and recognizing responsible forest manage-
ment. Its leading role was reaffirmed in late 2004 when FSC was selected from a field of almost
500 non-government organizations as the inaugural recipient of the Alcan Sustainability Award.
The selection process, conducted by the International Business Leaders Forum (IBLF), consid-
ered both how FSC operated and the contribution it was making to global sustainable develop-
ment.

The role of FSC as a driver and symbol for responsible forest management was also recognized
in a series of independent reviews of forest certification programs during 2004. For instance, a
review for the United Kingdom (UK) Government led to FSC being recognized as the preferred
standard for procurement of forest products by government agencies in that country. Private
buyers of forest products such as the Kingfisher Group has recognized FSC as a preferred
symbol of responsible forest products for its Do-It-Yourself chains and the European forest
campaign group, Fern, reported that FSC was „the most independent, rigorous and credible
forest certification system”.

FSC promotes environmentally appropriate, socially beneficial and economically viable
management of the word’s forests. It does this by bringing interested people and groups
together to develop standards for forest management based on FSC’s 10 Principle’s & Criteria
for responsible forest management. Forest management standards are developed at the global,
national and sub-national level. FSC accredits independent organizations who certify forest
management units as complying with these standards and producers who use FSC certified
wood. It helps customers recognize products that use FSC certified wood through a distinctive
trademark attached to products.

There are a number of factors that make FSC unique: It is independent of any one interest
group in the forest sector - balance between different interests is protected in the FSC statutes;
FSC standards development processes require broad stakeholder involvement to ensure
balanced outcomes; it is a global, membership-based organization with significant voluntary and
philanthropic contributions; FSC retains the endorsement of a broad range of environmental,
social and industry stakeholders, and its standards are internationally recognized as the global
benchmark.

FSC puts people at the heart of its program. In fact, four of the FSC Principles relate to social
factors. These cover areas such as legal and traditional rights of forest communities and indige-
nous peoples, equity, cultural identity, traditional forest stewardship and the social benefits of
forest management as well as the rights of forest workers. In 2002, a social strategy was
approved to promote the FSC vision of socially beneficial forestry, the first fruits of which were
the introduction of streamlined procedures to improve access to certification for small and low
intensity forest management operations. In addition, FSC has launched an initiative, through an

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How FSC works

extensive consultation process with social stakeholders and others, to ensure that forest
communities’ and indigenous peoples’ land tenure and resource use rights are fully taken into
account in the elaboration of national forest management standards and the application of FSC
Principles & Criteria in the forest.

FSC measures success across a number of criteria. By the end of January 2005, more than 51
million hectares of forest in 60 countries had been certified to FSC standards. To show the
impact of certification on forest areas, FSC is developing a range of measures to track the envi-
ronmental, social and economic benefits that flow from FSC certification. The strength of the
system is illustrated by the 15 independent third party organizations who certify to FSC
standards, the 4363 certificates in 76 countries that have been issued by these certifiers and the
US$ 3-5 billion in FSC certified forest products sold each year. Organizational strength is
documented by the growing number of National Initiatives, currently in 34 countries, over 600
members and the establishment during 2004 of a permanent FSC International Center in Bonn,
Germany..

How FSC works

Governance

FSC is an international association of members including representatives from environmental
and social groups, the timber trade, the forestry profession, forest owners, indigenous peoples’
organizations, community forestry groups and forest product certification organizations.
Governance is built on the principles of equal participation, democracy and equity. These
principles are reflected in the FSC statutes and enacted in its triennial General Assembly, its
Board of Directors and its standards development processes.

The General Assembly of members is the highest decision-making body in FSC. It meets at
least every three years to set broad policies and direction for the organization. Membership
interests are organized in three chambers - environmental, social and economic. The purpose of
the chamber structure is to maintain equal balance between different interests in decision
making. Each chamber has one third of the voting power in the General Assembly. The
chambers broadly comprise the following groups:
The Social Chamber includes non-government organizations whose missions are to protect
and enhance social, indigenous or community interests. For instance; indigenous people’s
associations, unions, community groups and development organizations. Individual
members may be from research, academic or technical institutions or people who have
demonstrated a commitment to socially beneficial forestry.
The Environment Chamber includes non-profit, non-government organizations whose
missions are to protect and promote environmental values and interests of forests. It
includes global as well as regional and local environmental groups. Individual members
may be from research, academic or technical institutions or people with an active interest in
environmentally viable forest management.

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Forest Stewardship Council
Heiko Liedeker / Michael Spencer

The Economic Chamber includes organizations and individuals with a commercial interest
in forests, forestry and forest products. Examples include forest owners, forest companies
and other enterprises, employees, certification bodies, industry and trade associations,
wholesalers, retailers, traders and consulting companies.

Organizations and individuals from the ‘Global North’ and from the ‘Global South’ each have 50
per cent of the voting power within each chamber, in order to achieve a balance between
economic ‘north’ and economic ‘south’ interests and to ensure recognition of the specific differ-
ences between southern and northern interests.

Between General Assemblies, the FSC Board of Directors is accountable to the FSC members.
It is made up of nine individuals, 3 from each chamber elected for a three year term. The
Executive Director is appointed by the Board of Directors.

Standards

FSC develops international, national and sub-national standards in a transparent, independent
and participatory way which balances the interests of all stakeholders, ensuring that no one
interest dominates. These processes strive to involve all interested people and groups in the
development of policies and standards.

The Policy and Standards Unit of the FSC International Center develops international
standards, international policies, guidance documents, discussion papers, and advice notes.
Standards and policies are approved by the FSC Board of Directors and set out procedures and
requirements to ensure that activities throughout the FSC systems are carried out in a consis-
tent and fair manner. FSC is committed to complying with the International Social and Environ-
mental Accreditation and Labelling (ISEAL) Alliance Code of Good Practice for setting social
and environmental standards.

Based on international requirements FSC National Initiatives develop national or sub-national
forest management standards. This ensures these standards are locally relevant and compre-
hensively reflect the input of local stakeholders while still adhering to the 10 FSC Principles &
Criteria for responsible forest management.

By way of example, in 2004 FSC approved the forest management standard for the Canadian
Boreal Forest. This standard covers a forest area of 325 million hectares stretching from the
Yukon to Newfoundland an area that includes 80 percent of Canadian indigenous communities
and provides 354 000 jobs. Consultation involved a mailing list of over 2000 individuals, organi-
zations and enterprises and participation of 200 representatives in 15 committees and task-
forces over a two year period. With broad support from industry, First Nations, environment and
social groups it was an extremely successful national standards development process covering
the largest territory in FSC history.

Also in 2004, FSC approved a new standard for ensuring the chain of custody is protected for
manufactured products. This process started in 2001 and involved a review and situation analy-
sis, deliberation at the 2002 FSC General Assembly, global stakeholder meetings, a series of

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Standards

technical working groups, review committees and discussion papers. Pilot tests were conducted
involving 31 companies in seven countries. Communication with stakeholders took place
through FSC publications (25 articles) and external publications, a special web site and face to
face discussions at formal and informal meetings involving hundreds of people around the
world.

Lastly the introduction of the new streamlined standards for forest certification for small and low
intensity managed forests took effect in 2004, a culmination of two years’ work of analysis and
consultation, supplemented by field testing the new procedures in locations in both the Global
North and Global South. Certification bodies report that, thanks to the new procedures, costs
savings of 40% or more have been achieved without the rigor of FSC certification being
affected. For the first time this particularly offers a prospect for small operations in the South to
access certification.

Accreditation

Growing interest in credible certification of responsible forestry, improved certification standards
and increased demand generated by major retailers and public procurement has resulted in a
sharp rise in demand for FSC accreditation services. In 2004, the number of accredited certifi-
cation bodies rose to 15, with 4 new applications in process, and expressions of interest
received from a further 8 organizations. The number of FSC certificates on issue grew by over
20 percent.

FSC does not undertake certification itself. FSC supports an accreditation program using recog-
nised international requirements (ISO/IEC Guide 17011), and accredits certification bodies for
compliance with the requirements of ISO/IEC Guide 65 together with specific FSC guidance for
implementation in the forest sector. Accredited certification bodies offer Forest Management
(FM) certification against FSC standards to forest managers. To track certified wood products
from the forest through processing, trade and manufacturing to retailers and consumers and to
prevent misuse of the FSC Logo and trademark, accredited certification bodies offer certification
of the Chain of Custody (CoC) to traders, manufacturers, retailers and others.
FM certification requires forest managers to adhere to FSC standards for the management
of their forests. These standards are developed, based on FSC’s Principles & Criteria,
through consultation at the national and local level. Where national or sub-national
standards have not been developed yet, certification bodies’ international standards are
locally-adapted and applied.
CoC certification applies to traders, manufacturers, retailers and others who trade, process
or transform forest products. The main objective of CoC certification is to ensure that
material from FSC certified forests is tracked through the production process. In this way,
customers and consumers are assured that FSC certified and labeled products originate
from certified forests. To market timber products from certified forests, FM certificate
holders must also have CoC certification.

The objective of the FSC accreditation process is to enable existing independent certification
bodies working in the area of forest management and/or chain of custody verification, to certify

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to FSC standards and award the use of the FSC trademarks to forest management operations,
timber traders, processors, manufacturers and retailers. The FSC accreditation process enables
existing independent certification bodies by verifying, endorsing and regularly monitoring
compliance of their respective certification standards, procedures and competence with FSC
accreditation standards and requirements. This ensures that all accredited certification bodies
achieve consistent outcomes when certifying forest management operations for conformity with
FSC FM standards and timber traders, processors, manufacturers and retailers for conformity
with FSC CoC standards.

The accreditation process consists of several stages beginning with a request for information, a
formal application, document evaluation, an office visit, field visits and an accreditation report to
the FSC Board of Directors, which, based on the report takes the accreditation decision. The full
accreditation process requires between 9 and 18 months. A list of FSC accredited and applicant
certification bodies is available at the FSC web site.

The certification audits conducted by accredited certification bodies require balancing social,
economic and environmental values and interests. To ensure continued compliance with FSC
requirements, the FSC Accreditation Program conducts regular surveillance audits involving
both office and field visits to monitor performance of certification bodies. FSC provides monthly
updates on certificates issued by accredited certification bodies based on reports submitted.

The FSC Accreditation Program undertakes an annual review of all complaints received by each
certification body. Complaints and disputes between stakeholders and certification bodies over
certification processes and certificates issued are dealt with through a number of dispute
resolution mechanisms.

In addition to accrediting certification bodies, the FSC Accreditation Program accredits FSC in-
country National Initiatives and national FSC forest stewardship standards. National Initiatives
are the foundation of the global FSC global network. They are independent national organiza-
tions that develop based on the international FSC Principles & Criteria, national forest steward-
ship standards and promote FSC. Their accreditation by the FSC accreditation program ensures
they operate consistently around the world and in line with FSC standards and requirements. At
the end of 2004, 34 National Initiatives had been accredited and recognized as complying with
FSC requirements.

The third area addressed by the FSC Accreditation Program is the accreditation of national or
sub-national forest stewardship standards. This is to ensure consistency and integrity of
national or sub-national forest stewardship standards in different countries and regions around
the world. Through accreditation FSC verifies that national or sub-national forest stewardship
standards meet all requirements set by FSC to ensure the credibility of the FSC certification
process. These requirements refer equally to both content of the standards and the processes
used to develop the standards, including compliance with FSC Principles & Criteria, a balanced
national and local consultative process and compatibility with local circumstances. Once a
national forest stewardship standard has been accredited by FSC, all certification bodies must
use this standard in their certification processes. At the end of 2004, FSC had accredited 22
national and sub-national forest stewardship standards.

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Accreditation

In order to enhance the integrity of its systems and processes, FSC has separated its accredita-
tion program from its standards and policy development program. The objective is to ensure
there can be no conflict of interest between the accreditation function and the policy and
standard setting processes. Both, the FSC accreditation program and the FSC standards and
policy setting program and their respective separation are in full compliance with accepted
international norms.

Trademark

The consumer faces of the FSC system are its logo and trademarks. The widely recognized
‘check mark and tree’ logo as well as the words ‘Forest Stewardship Council’ and initials ‘FSC’
complete the connection between the consumer and the forest. Through the trademark,
consumers are able to prefer and retailers are able recognize timber products from responsibly
managed forests.

The FSC trademark is used on some 20 000 products world-wide valued at between US$3 and
5 billion annually. In the UK retail sector alone, products carrying the FSC logo account for over
US$2 billion in retail product sales annually. The rate of growth in demand for products carrying
FSC trademarks has been strong with major retailers in Europe, North and South America and
Asia highlighting their FSC product range. In the Netherlands, consumer awareness has grown
following a series of market promotions with more than one in four consumers saying they think
of FSC when looking for forest products in stores.

FSC trademarks can only be used on products for which a valid FSC Chain of Custody certifi-
cate has been issued. The trademark labeling system requires that the certificate number be
reproduced as part of the label so that the validity of the certificate can be checked. FSC trade-
marks cannot be used on products together with the logos, names or identifying marks of other
forest certification schemes that do not comply with the 10 FSC Principles and Criteria for
responsible forest management. Use of FSC trademarks and labels on products is authorized
by FSC accredited certification bodies.

The trademarks are also used for promotional purposes other than on particular products.
Examples include leaflets, brochures, advertising material and web sites. These uses are strictly
controlled by the FSC Trademark Manual as well as FSC standards for promotional use of its
trademarks. Use for these purposes is authorized by FSC accredited certification bodies, FSC
National Initiatives or FSC International Center. In general, FSC trademarks used for promo-
tional purposes must avoid misleading consumers or the public as to the extent of certification,
the scope of certification or the range of products covered by FSC certificates.

During 2004, FSC simplified its label designs to provide a more consistent, easy to recognize
label for consumers. The process emphasized the importance of adhering to ‘truth in labeling’
requirements. The FSC labels ensure consumers can easily recognize products that contain
either 100 percent FSC certified content, or some combination of FSC certified content,
controlled sources and/or post-consumer recycled. FSC also developed a label for 100 per cent
post consumer recycled so as to provide a simplified offer for organizations and individuals

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following responsible purchasing policies. This initiative removed the problem of a perceived
conflict between FSC and recycled products.

At the same time FSC was enhancing the integrity of its labeling system, stronger efforts were
being made to deal with fraud and forgery. As the value of the FSC system grows, so too does
the temptation for unscrupulous or naive operators to ‘free ride’ on the FSC system. FSC
stepped up its monitoring of trademark use in cooperation with environmental groups during
2004. As a result, some certificates were suspended and action was taken against companies
that did not hold valid certificates but used the FSC trademarks to mislead consumers. At least
one European wholesaler subsequently closed its operations. These efforts are receiving
increasing priority.

FSC has begun to develop strong partnerships with users of the FSC system in order to better
promote both demand and supply of FSC certified products. In this regard, the trademark will
continue to play an important part in generating recognition for responsible forestry and encour-
aging forest managers to change their practices in line with the FSC Principles & Criteria.

The future

While FSC has grown strongly during its first 10 years, and is currently experiencing its strong-
est growth to-date, the future is not expected to become easier. It is becoming increasingly clear
that forest area certified is not a suitable measure for the performance of any credible forest
certification scheme. It is the quality and scope of economic, environmental and social
improvements to existing forest practices that distinguishes credible forest certification. FSC
now has to prove its success as environmental, social and economic stakeholders in the global
south and north demand more information on FSC’s impact than just hectares certified. Stake-
holders have indicated they need to see outcomes relevant to their particular interests meas-
ured and evaluated. This is not only a measurement challenge, but requires that FSC together
with its accredited certification bodies, certificate holders and partners creates new systems for
comprehensively evaluating and measuring its economic, environmental and social impact.
Resourcing such a global, inclusive, stakeholder driven program remains a major challenge.

Furthermore, while forest certification during its first decade of success was quickly taken up by
forest management operations in the global north and only to a lesser extent in the south,
stakeholders have indicated they expect more significant outcomes over coming years in terms
of certification and adoption of FSC standards in the important forested areas of the economic
south. This will require considerable effort as forest management operations in these regions
often do not have the capacity, the civil society framework or the legal infrastructure to proceed
as quickly as their counterparts in the economic north. FSC needs to improve its relations with
economic partners, environmental organizations as well as social, community and indigenous
people’s groups to respond to these developments - especially in the economic south but also
the economic north. These groups seek concrete benefits from forest certification, not solely
economic and environmental ones but also in terms of protecting tenure and use rights, of
controlling and managing their own natural resources and in achieving better working condi-
tions. Some view forest management certification as a development tool which can deliver real
benefits to improve quality of life. This presents a major challenge to the FSC as many of these

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The future

stakeholder groups are dispersed and operating at the local level. They face technical and
marketing obstacles which are very different from those of larger economic enterprises. Decen-
tralization of FSC through a network of regional offices and strengthened FSC National Initia-
tives will be an important tool to address through the implementation of the FSC Social Strategy
such need of local stakeholders, communities and indigenous peoples’ groups.

The improvement of workers’ conditions through certification is yet another challenge. FSC
accepts the various Conventions of the International Labour Organisation (ILO) covering work-
ers’ rights and, while it does not seek in any way to supplant national labour legislation, it
requires compliance with good working practices, including health and safety and the right to
collective bargaining, as a way forward to fulfil its mission of socially beneficial forestry.
Although FSC criteria relating to labour conditions only apply to forest management operations,
FSC is aware of the advantages of extending social requirements throughout the chain of
custody. There are, however, practical and conceptual difficulties involved in this and FSC
intends to explore how it may most effectively be done.

Last but not least an ongoing challenge is presented by competition with other forest certifica-
tion schemes, which apply less demanding FM and CoC standards, lack the rigor of perform-
ance evaluation during certification, are less transparent and/or do not provide equal and equi-
table participation of environmental and social interests. Since FSC was established 10 years
ago, more than 60 initiatives to develop forest certification schemes have been conceived. Few
still exist and none of these schemes has proposed a more comprehensive system for forest
stewardship certification involving higher standards of forest management, greater accountabil-
ity or stronger inclusion of stakeholders.

While the environment in which FSC operates is challenging, the future remains far more
positive than negative. Interest in FSC has never been greater as reflected in the 10 year
anniversary conference held during 2004. The rate of growth of certificates issued has been
strong. Increasing commitment by governments to responsible sourcing policies is driving inter-
est and demand in credible forest management standards, chain of custody processes and
certification. The private sector is embracing more seriously corporate social responsibility
which complements FSC´s drive to achieve tangible social benefits. Major retailers are increas-
ing their involvement and engagement with FSC. As the volume of FSC products in the market
grows, the bar is being raised to suppliers who are outside the FSC systems.

There is growing opportunity for alignment between customers who want to adopt responsible
sourcing strategies (as well as consumers who want to avoid products from irresponsibly
managed sources) and companies who perceive consumer awareness of responsible forestry
as a business opportunity. Some of the world’s major forest products companies are becoming
involved in the FSC system in ways unprecedented in FSC history. FSC can provide an inde-
pendent meeting place where commercial interests can find common ground with social and
environmental interests. In doing so, all interests can benefit by working together on matters of
mutual interest. In its first decade FSC has successfully moved from a vision to an idea, from an
idea to examples on the ground, and from examples on the ground to a model proven world-
wide. In its next decade FSC will evolve from a global model to mainstream reality setting the
benchmark for economic, environmental and social performance of forest stewardship through-
out the sector worldwide.

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Box 1

FSC Principles and Criteria for Forest Stewardship

FSC forest management standards are based on the FSC Principles and Criteria for Forest
Stewardship. Balanced groups of stakeholders adapt these international Principles and Criteria to
national conditions by adding auditable indicators, producing a forest management standard for
FSC certification in that country or region of the country. It is this process that enables FSC to
promote locally appropriate and globally respected forest management. Set out below are the
10 Principles. The full Principles and Criteria are available from the FSC International web site
www.fsc.org.

Principle 1: Compliance with laws and FSC Principles

Forest management shall respect all applicable laws of the country in which they occur, and
international treaties and agreements to which the country is a signatory, and comply with all FSC
Principles and Criteria.

Principle 2: Tenure and use rights and responsibilities

Long-term tenure and use rights to the land and forest resources shall be clearly defined,
documented and legally established.

Principle 3: Indigenous peoples' rights

The legal and customary rights of indigenous peoples to own, use and manage their lands,
territories, and resources shall be recognized and respected.

Principle 4: Community relations and workers’ rights

Forest management operations shall maintain or enhance the long-term social and economic well-
being of forest workers and local communities.

Principle 5: Benefits from the forest

Forest management operations shall encourage the efficient use of the forest's multiple products
and services to ensure economic viability and a wide range of environmental and social benefits.

Principle 6: Environmental impact

Forest management shall conserve biological diversity and its associated values, water resources,
soils, and unique and fragile ecosystems and landscapes, and, by so doing, maintain the ecological
functions and the integrity of the forest.

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The future

Principle 7: Management plan

A management plan -- appropriate to the scale and intensity of the operations -- shall be written,
implemented, and kept up to date. The long term objectives of management, and the means of
achieving them, shall be clearly stated.

Principle 8: Monitoring and assessment

Monitoring shall be conducted -- appropriate to the scale and intensity of forest management -- to
assess the condition of the forest, yields of forest products, chain of custody, management
activities and their social and environmental impacts.

Principle 9: Maintenance of high conservation value forests

Management activities in high conservation value forests shall maintain or enhance the attributes
which define such forests. Decisions regarding high conservation value forests shall always be
considered in the context of a precautionary approach.

Principle 10: Plantations

Plantations shall be planned and managed in accordance with Principles and Criteria 1 - 9, and
Principle 10 and its Criteria. While plantations can provide an array of social and economic
benefits, and can contribute to satisfying the world's needs for forest products, they should
complement the management of, reduce pressures on, and promote the restoration and
conservation of natural forests.

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The PEFC Council and sustainable forest management
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The PEFC Council and sustainable forest management
Ben Gunneberg / Oliver Scholz

Introduction

The PEFC Council (Programme for the Endorsement of Forest Certification schemes) is an
independent, non-profit, non-governmental organisation, which provides a framework for the
development and assessment of independent third party certification of environmentally appro-
priate, socially beneficial and economically viable management of forests. The PEFC provides
an assurance mechanism to purchasers of wood and paper products that they are promoting
the sustainable management of forests.

This is achieved through nationally or regionally multi-stakeholder developed, independent
forest certification systems, based on the criteria, indicators and operational level guidelines
developed by the intergovernmental processes promoting sustainable forest management,
following the United Nations Conference on Environment and Development (UNCED) in Rio de
Janeiro in 1992. These on-going intergovernmental processes are supported by 149 govern-
ments in the world covering 85% of the world's forest area.

In addition the PEFC provides a framework and global umbrella for the assessment of and
mutual recognition of national forest certification schemes developed in an open and transpar-
ent process with a balanced multi-stakeholder representation.

Background

The PEFC Council was formed in June 1999 as a Pan European initiative with representative
schemes from eleven countries. With PEFC’s rapid development into a global umbrella organi-
zation for the assessment and recognition of forest certification systems the acronym PEFC was
changed in 2003 from the former „Pan European Forest Certification” to mean the „Programme
for the Endorsement of Forest Certification schemes”.

PEFC today has in its membership 31 independent national forest certification systems from six
continents of which 18 to date have been through a rigorous assessment
process for endorsement by the PEFC Council involving public consulta-
tion and the use of independent consultants, whose assessments are
publicly available to provide the assessments on which mutual recogni-
tion decisions are taken by the members. To date these 18 schemes
account for over 122 million hectares of certified forests worldwide
producing millions of tonnes of certified timber to the market-place
making PEFC the world's largest certification system. The non-endorsed
members’ systems are at various stages of development and are working
towards mutual recognition under the PEFC processes.

113
Background

Beginning 2005 the following systems are members - both endorsed (*) and not endorsed yet -
of the PEFC Council:

Figure 1: National certification systems in the PEFC Council (April 2005)

AFS Australian Forestry Standard Ltd.* PEFC Latvia Council*
PEFC Austria* PEFC Lietuva
PEFC Belgium* PEFC Luxembourg
CSA Canadian Standards Association* MTCC Malaysian Timber Certification Council
CERFLOR Brazil PEFC Norway*
CertforChile* PEFC Polska
PEFC Czech Republic* Portuguese Forestry Sector Council*
PEFC Denmark* National Voluntary Forest Certification Council in
Russia RSFC
Estonian Forest Certification Council
Slovak Forest Certification Association
FFCS Finish Forest Certification Council*
Institute of Forest Certification Slovenia
PEFC France*
PEFC España*
PAFC Pan-African Forest Certification Gabon
Swedish PEFC Co-operative*
PEFC Germany*
PEFC Switzerland and HWK - (Schweizerische
PEFC Council of Ireland
Holzwirtschaftskonferenz) Zertifizierungsstelle*
PEFC Italia*
PEFC UK Ltd.*
ATFS American Tree Farm System (USA)
SFI Sustainable Forestry Initiative (USA and Canada)

The members of the PEFC Council, the National Governing Bodies, which represent stake-
holders at national level, take decisions in a democratic way. Similar to other decision-making
processes of international institutions like e.g. the United Nations, the PEFC Council members
have one to three votes each in the PEFC General Assembly, in this case based on the national
annual timber harvest according to Food and Agriculture Organisation (FAO) statistics.

International organisations supporting PEFC objectives can on application become Extraordi-
nary Members of the PEFC Council with an observer status. Currently international associations
from the following sectors have chosen this form of membership: saw milling and panel board
industry, woodland owners, paper industry, landowners, forest contractors, timber traders,
community forests, forest managers and regional foresters.

The majority of stakeholders however work in and support the PEFC system by membership in
the National Governing Bodies of the national certification systems, among them a wide range
of national and local environmental non-governmental organisations (ENGOs) actively involved
in the PEFC system.

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Figure 2: Structure of the PEFC Council

Structure

Finland Estonia Denmark Czech Repulic Chile Canada Belgium Brazil Austria Australia USA

France United Kingdom

Germany Switzerland
GENERAL ASSEMBLY
Highest decision-making
Gabon MEMBERS
authority under the PEFCC
National Governing
Bodies are members
Ireland of the PEFCC
BOARD OF SECRETARIAT
Italy DIRECTORS GENERAL
Administration and Every day running of Verious
Management under PEFCC Stakeholders
Latvia
the PEFCC
(3+10 members)
EXTRAORDINARY
Lithuania MEMBERS

Lithuania Luxembourg Malaysia Norway Portugal Poland Russia Spain Slovakia Slovenia Sweden

The PEFC Board of Directors has the task to prepare the decisions of the PEFC General
Assembly, the every day management of the PEFC Council is undertaken by the PEFC Secre-
tariat General

The PEFC Council has the following main activities:
Definition of minimum requirements-framework for development of national or sub-national
forest certification schemes.
Assessment and endorsement (mutual recognition) of national or sub-national forest
certification schemes.
Administration of PEFC Logo usage rights.
Promotion of PEFC recognised forest certification and of sustainable forest management.

The following eighteen PEFC endorsed systems (as of April 2005) account for more than 122
million hectares of certified forests (Figure 3) producing millions of tonnes of certified timber to
the market place and this figure is increasing rapidly.

115
Background

Figure 3: Summary of certified hectares of PEFCC endorsed forest certification
schemes (including Japan and the Netherlands for chain of custody certifica-
tion) (April 2005)

PEFC/Countries Endorsed certified Number of Chain of
forest area (ha) Custody certificates

Australia 1 092 678 1
Austria 3 924 000 272
Belgium 230 528 16
Canada 63 700 000 0
Chile 1 527 180 0
Czech Republic 1 935 228 198
Denmark 13 641 4
Finland 22 355 596 82
France 3 553 043 673
Germany 6 989 651 496
Italy 356 053 13
Japan 0 5
Latvia 31 364 14
Netherlands 0 2
Norway 9 231 700 5
Portugal 0 0
Spain 417 502 23
Sweden 6 412 149 58
Switzerland 316 850 157
UK 9 125 71
Total 122 096 291 2 090

The Brazilian Program of Forest Certification, Cerflor; PEFC Estonia; PEFC Lithuania; PEFC
Luxembourg and PEFC Slovak Republic are currently undergoing the PEFC assessment
process. Other certification systems are preparing for PEFC membership and/or submission of
their application for endorsement.

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Ben Gunneberg / Oliver Scholz

PEFC Council requirements

Requirements of the PEFC certification are laid down in the PEFC Technical Documentation
approved by the members of the PEFC General Assembly. The PEFC Technical Documenta-
tion comprises the Technical Document, Annexes and Guidelines. It includes the normative
documentation for the development, elaboration and implementation of national or sub-national
forest certification systems and procedures for their endorsement within PEFC.

The general part of the document presents the framework for the documentation and the
normative requirements are listed in the respective Annexes and Guidelines (PEFC 2005).

The Technical Document defines the common elements and requirements, which have to be
met by certification schemes wishing to take part in the PEFC framework and use the trademark
of the PEFC Council. These minimum requirements will help to promote sustainable forest
management and assure consumers that products with a PEFC label come from or promote
sustainably managed forests.

In order to ensure an appropriate degree of equivalency and comparability, common threshold
requirements are defined for the following aspects of forest certification:
scheme development,
certification criteria,
scheme implementation,
audit and certification procedures,
chain of custody certification,
PEFC Council endorsement and mutual recognition procedures.

Annex 1 (Terms and Definitions) defines the basic and fundamental terms relating to forest
certification, as they apply for the preparation and use of forest certification standards and for
mutual understanding in the international context.

Annex 2 (Rules for Standard Setting) based on International Organization for Standardization
(ISO) Guide 59 (Code of Good Practice for Standard Setting) provides the rules for the standard
setting process that a certification scheme applying for PEFC endorsement and mutual recogni-
tion shall fulfil. The rules guide balanced standard setting processes and scheme development
at national or sub-national levels. The document covers standard setting procedures for certifi-
cation of sustainable forest management and Chain of Custody certification, ensuring transpar-
ency, balanced representation and consensus in the process.

Annex 3 (Basis for National Certification Schemes and their Implementation) defines the
minimum requirements a scheme shall meet, rules for its implementation and scheme docu-
mentation required for forest and Chain of Custody certification.

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PEFC Council requirements

Figure 4: PEFC technical document, annexes and guidelines1

PEFC Council Statutes Reference Documents
Describe referece base of PEFC
(see footnote for acronyms)

a Memorandum
b PEOLG and ITTO/ATO PIC
c C&I for SFM defined by MCPFE,
Montreal etc.
d International ILO Conventions
- Core ILO Conventions
- Other Conventions

Normative Documents

Annexes Guidelines
include the normative provide details implementation
requirements of normative issues presented
in the resprective annex

Technical Annex 1 • Issuance of PEFC logo
Document Terms and Definitions usage licenses by the PEFC
Council
Framework
on the Annex 2:
• Application of PEFC logo
elements of license
Rules for Standard
the PEFC Setting • PEFC Minimum
Scheme Requirements Checklist
Annex 3: • etc.
Basis for Certification
Schemes and their
Implementation

Annex 4:
Chain of Custody of
Forest Based Products -
Requirements

Annex 5:
PEFC Logo Usage Rules

Annex 6:
Certification and
Accreditation Procedures

Annex 7:
Endorsement of National
Schemes and their
Revision

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Annex 4 (Chain of Custody of Forest Based Products - Requirements) covers the interna-
tional Chain of Custody for tracking of wood flows. This Chain of Custody standard has been
developed so that it can be endorsed and utilised by any forest certification or labelling system,
which includes Chain of Custody rules, for the purposes of using declarations and/or labels
referring to the origin of the raw material in the forest based products.

Annex 5 (PEFC Logo Use rules) sets up regulations for PEFC logo use to assure the protec-
tion of ownership rights of the PEFC Logo and transparent and credible communication of
claims connected with PEFC certification and provides strict requirements for the correct usage
of the PEFC logo and claims.

The Annex establishes the rules
which specify who the owner and governor of the logo is,
on who has the right to use the PEFC logo and trademark,
on what kind of claims are included in the logo,
for what kind of on- and off-product communication the logo can be used for,
on what the specifications are as regards the reproduction of the PEFC logo in printed and
published form.

Annex 6 (Certification and Accreditation procedures) defines the certification and accredita-
tion procedures for forest and chain of custody certifications adopted and considered credible
and reliable by the PEFC Council.

Certifications for forest management and chain of custody recognised by the PEFC Council, rely
on international certification and accreditation procedures as defined in the documentation of
the International Organisation for Standardization (ISO) and as well as in the International
Accreditation Forum (IAF).

Annex 7 (Endorsement and Mutual Recognition of National Schemes and their Revision)
describes the procedures for the endorsement and mutual recognition process of national or
sub-national forest certification systems against the PEFC requirements.

The endorsement of a scheme means that the members of the PEFC Council have determined
that the scheme meets the requirements of the PEFC Council. The voting procedures ensure
that each scheme votes on each other, based on the independent consultant’s report (publicly
available) which guides the decision making. Therefore the schemes mutually recognise each
other under the PEFC Council mutual recognition umbrella.

The objectives of the Guidelines are (i) to assist bodies, which develop or revise their forest
certification schemes and prepare an application for PEFC Council endorsement, and (ii) to
facilitate the assessment of the compliance of a national or sub-national forest certification
scheme against the PEFC Council requirements carried out by the PEFC Council as a part of its
endorsement and mutual recognition process (Annex 7 Endorsement and Mutual Recognition of
National Schemes and their Revision). The Guidelines are a compendium with several check-
lists covering several hundred different aspects of forest certification.

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Forest management standards

Forest management standards

For the forest certification purposes, each country develops in a broad multi-stakeholder proc-
ess its own national (or regional) standard for sustainable forest management based on the
Ministerial Conference on the Protection of Forests in Europe (MCPFE) guidelines or other
intergovernmental processes promoting sustainable forest management (SFM), the national
laws and regulations and the core International Labour Organisation (ILO) conventions and
other international conventions ratified by the country.

Figure 5: Basic requirements for PEFC endorsed certification systems

Inter-governmental
processes for SFM PEOLG
(Pan European C&I Reference base
Montreal Process, etc.)

National laws, National / regional
regulations, policies, Review of criteria requirements for
programmes certification criteria

International Core ILO
Conventions Conventions

Criteria and indicators for SFM

Sustainable forest management (SFM) has been, since the UNCED in Rio in 1992, a leading
concept in international deliberations and work. The result today is a broad consensus on
principles, guidelines, criteria and indicators for SFM on international governmental level. One
such process is the MCPFE, an ongoing process in which thousands of experts from a very
wide range of stakeholder groups have been involved.

At its conference held in Lisbon in 1998, MCPFE declared its commitment to endorsing the
voluntary Pan European Operational Level Guidelines for Sustainable Forest Management
(PEOLG), which had been previously adopted by an expert level preparatory meeting. The
guidelines form a common framework of recommendations that can be used on a voluntary
basis and as a complement to national and or regional instruments to further promote sustain-
able forest management at the field level, on forest areas. Potential uses of the guidelines as
stated by the ministers include its use as an indicative reference for the establishment of
standards for forest certification schemes.

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Figure 6: Criteria and indicators for SFM

Criteria and example indicators for sustainable forest management

Growing Balance Forest area
General stock between under
Capacity growth & management
Carbon removal
storage
Land use &
forest area Non-wood
Productive products
Forest resources functions of
& global carbon forests
cycles

Public
Defoliation participation
Air Cultural
pollutiants values & awareness

Research and
Forest health Socio-
Sustainable education
Different & vitality economic
Forest
damages Management aspects

Nutrient Recreational
balance & Employment services
acidity

Productive Significance
Biological
functions of of forest
diversity
forests sector

Gerneral General
protection protection
Water Threatened
conservation species Rare
Soil erosion Species
Biodiversity
in production
forests

Source: Ministeral conference on the
protection of forests in Europe

Parallel to the MCPFE process, seven other similar intergovernmental processes are currently
ongoing worldwide, which can serve as a basis for the development of national forest certifica-
tion systems. These are the:
Montreal process,
Near East Process, Lepaterique Process,
Regional Initiative of Dry Forests in Asia,
International Tropical Timber Organization (ITTO) Criteria and Indicators for Sustainable
Management of Natural Tropical Forests,
Criteria and Indicators for Sustainable Management in Dry-zone Africa,
Tarapoto Proposal: Criteria and Indicators for the Sustainable Management of Amazonian
Forests,

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Forest management standards

African Timber Organization Principles, Criteria and Indicators for Sustainable Management
of Natural Forests.

Figure 7: Intergovernmental processes for SFM

Countries participating in the 8 intergovernmental processes for SFM criteria & indicators

ATO Montreal ITTO Dry Zone Africa

Helsinki Tarapoto Lepateriqué North Africa & Near East

Montreal / Helsinki ATO / ITTO

It is important to note that thousands of experts from a very wide range of stakeholder groups
have been involved in the development of these political processes and that they are ongoing.
This means that over time as society’s values etc. change and are expressed through the inter-
governmental processes, so the PEFC will reflect this. Many countries have, and are develop-
ing, their national forest certification schemes building on these all-inclusive political processes,
which continue to evolve.

Depending on their developing stage, the processes have resulted in Criteria, Indicators or
Operational Level Guidelines. The African Timber Organisation (ATO) and ITTO processes

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have resulted in the ATO/ITTO principles, criteria and indicators for the sustainable manage-
ment of African natural tropical forests. They have been recognised by the PEFC Council as
basis for the development of national forest certification systems for the African countries.

The Criteria and Indicators of the MCPFE are specified by the Pan European Operational Level
Guidelines (PEOLG) which are as follows:

Pan European Operational Level Guidelines (PEOLG)

The Annex 2 of the Ministerial Resolution L2 states: „The Operational Level Guidelines form a
common framework of recommendations that can be used on a voluntary basis and as a
complement to national and/or regional instruments to further promote sustainable forest
management at the field level, on forest areas in Europe. Adopted at the Fifth Expert Level
Preparatory Meeting of the Lisbon Conference on the Protection of Forests in Europe, 27-29
April 1998, Geneva Switzerland.”

All forest certification standards applying for endorsement must fully comply with the PEOLG
requirements. The PEOLG are also used as the assessment threshold for schemes outside
Europe if the relevant intergovernmental process has not developed its own operational level
guidelines.

Criterion 1. Maintenance and appropriate enhancement of forest resources and their
contribution to global carbon cycles

1.1 Guidelines for forest management planning
a. Forest management planning should aim to maintain or increase forest and other
wooded area, and enhance the quality of the economic, ecological, cultural and social
values of forest resources, including soil and water. This should be done by making
full use of related services such as land-use planning and nature conservation.
b. Inventory and mapping of forest resources should be established and maintained,
adequate to the local and national conditions, and in correspondence with the topics
described in these Guidelines.
c. Management plans or their equivalents, appropriate to the size and use of the forest
area, should be elaborated and periodically updated. They should be based on
legislation as well as existing land use plans, and adequately cover the forest
resources.
d. Monitoring of the forest resources and evaluation of their management should be
periodically performed, and their results should be fed back into the planning process.

1.2 Guidelines for forest management practices
a. Forest management practices should safeguard the quantity and quality of the forest
resources in the medium and long term by balancing harvesting and growth rates,
and by preferring techniques that minimise direct or indirect damage to forest, soil or
water resources.

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Forest management standards

b. Appropriate silvicultural measures should be taken to maintain the growing stock of
resources at - or bring to - a level that is economically, ecologically and socially
desirable.
c. Conversion of abandoned agricultural and treeless land into forest land should be
taken into consideration, whenever it can add economic, ecological, social and/or
cultural value.

Criterion 2. Maintenance of forest ecosystem health and vitality

2.1 Guidelines for forest management planning
a. Forest management planning should aim to maintain and increase the health and
vitality of forest ecosystems and to rehabilitate degraded forest ecosystems, when-
ever this is possible by silvicultural means.
b. Health and vitality of forests should be periodically monitored, especially key biotic
and abiotic factors that potentially affect health and vitality of forest ecosystems, such
as pests, diseases, overgrazing and overstocking, fire, and damage caused by
climatic factors, air pollutants or by forest management operations.
c. Forest management plans or their equivalents should specify ways and means to
minimise the risk of degradation of and damages to forest ecosystems. Forest
management planning should make use of those policy instruments set up to support
these activities.

2.2 Guidelines for forest management practices
a. Forest management practices should make best use of natural structures and
processes and use preventive biological measures wherever and as far as economi-
cally feasible to maintain and enhance the health and vitality of forests. Adequate
genetic, species and structural diversity should be encouraged and/or maintained to
enhance stability, vitality and resistance capacity of the forests to adverse environ-
mental factors and strengthen natural regulation mechanisms.
b. Appropriate forest management practices such as reforestation and afforestation with
tree species and provenances that are suited to the site conditions or the use of
tending, harvesting and transport techniques that minimise tree and/or soil damages
should be applied. The spillage of oil through forest management operations or the
indiscriminate disposal of waste on forest land should be strictly avoided.
c. The use of pesticides and herbicides should be minimised, taking into account appro-
priate silvicultural alternatives and other biological measures.
d. In case fertilisers are used they should be applied in a controlled manner and with
due consideration to the environment.

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Criterion 3. Maintenance and encouragement of productive functions of forests (wood
and non-wood)

3.1 Guidelines for forest management planning
a. Forest management planning should aim to maintain the capability of forests to
produce a range of wood and non-wood forest products and services on a sustain-
able basis.
b. Forest management planning should aim to achieve sound economic performance
taking into account possibilities for new markets and economic activities in connection
with all relevant goods and services of forests.
c. Forest management plans or their equivalents should take into account the different
uses or functions of the managed forest area. Forest management planning should
make use of those policy instruments set up to support the production of merchant-
able and non-merchantable forest goods and services.

3.2 Guidelines for forest management practices
a. Forest management practices should be ensured in quality with a view to maintain
and improve the forest resources and to encourage a diversified output of goods and
services over the long term.
b. Regeneration, tending and harvesting operations should be carried out in time, and in
a way that do not reduce the productive capacity of the site, for example by avoiding
damage to retained stands and trees as well as to the forest soil, and by using appro-
priate systems.
c. Harvesting levels of both wood and non-wood forest products should not exceed a
rate that can be sustained in the long term, and optimum use should be made of the
harvested forest products, with due regard to nutrient offtake.
d. Adequate infrastructure, such as roads, skid tracks or bridges should be planned,
established and maintained to ensure efficient delivery of goods and services while at
the same time minimising negative impacts on the environment.

Criterion 4. Maintenance, conservation and appropriate enhancement of biological diver-
sity in forest ecosystems

4.1 Guidelines for forest management planning
a. Forest management planning should aim to maintain, conserve and enhance biodi-
versity on ecosystem, species and genetic level and, where appropriate, diversity at
landscape level.
b. Forest management planning and terrestrial inventory and mapping of forest
resources should include ecologically important forest biotopes, taking into account
protected, rare, sensitive or representative forest ecosystems such as riparian areas
and wetland biotopes, areas containing endemic species and habitats of threatened
species, as defined in recognised reference lists, as well as endangered or protected
genetic in situ resources.

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Forest management standards

4.2 Guidelines for forest management practices
a. Natural regeneration should be preferred, provided that the conditions are adequate
to ensure the quantity and quality of the forests resources and that the existing
provenance is of sufficient quality for the site.
b. For reforestation and afforestation, origins of native species and local provenances
that are well adapted to site conditions should be preferred, where appropriate. Only
those introduced species, provenances or varieties should be used whose impacts on
the ecosystem and on the genetic integrity of native species and local provenances
have been evaluated, and if negative impacts can be avoided or minimised.
c. Forest management practices should, where appropriate, promote a diversity of both
horizontal and vertical structures such as uneven-aged stands and the diversity of
species such as mixed stands. Where appropriate, the practices should also aim to
maintain and restore landscape diversity.
d. Traditional management systems that have created valuable ecosystems, such as
coppice, on appropriate sites should be supported, when economically feasible.
e. Tending and harvesting operations should be conducted in a way that do not cause
lasting damage to ecosystems. Wherever possible, practical measures should be
taken to improve or maintain biological diversity.
f. Infrastructure should be planned and constructed in a way that minimises damage to
ecosystems, especially to rare, sensitive or representative ecosystems and genetic
reserves, and that takes threatened or other key species - in particular their migration
patterns - into consideration.
g. With due regard to management objectives, measures should be taken to balance the
pressure of animal populations and grazing on forest regeneration and growth as well
as on biodiversity.
h. Standing and fallen dead wood, hollow trees, old groves and special rare tree species
should be left in quantities and distribution necessary to safeguard biological diversity,
taking into account the potential effect on health and stability of forests and on
surrounding ecosystems.
i. Special key biotopes in the forest such as water sources, wetlands, rocky outcrops
and ravines should be protected or, where appropriate, restored when damaged by
forest practices.

Criterion 5. Maintenance and appropriate enhancement of protective functions in forest
management (notably soil and water)

5.1 Guidelines for forest management planning
a. Forest management planning should aim to maintain and enhance protective func-
tions of forests for society, such as protection of infrastructure, protection from soil
erosion, protection of water resources and from adverse impacts of water such as
floods or avalanches.

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b. Areas that fulfil specific and recognised protective functions for society should be
registered and mapped, and forest management plans or their equivalents should
take full account of these areas.

5.2 Guidelines for forest management practices
a. Special care should be given to silvicultural operations on sensitive soils and erosion-
prone areas as well as on areas where operations might lead to excessive erosion of
soil into watercourses. Inappropriate techniques such as deep soil tillage and use of
unsuitable machinery should be avoided on such areas. Special measures to mini-
mize the pressure of animal population on forests should be taken.
b. Special care should be given to forest management practices on forest areas with
water protection function to avoid adverse effects on the quality and quantity of water
resources. Inappropriate use of chemicals or other harmful substances or inappropri-
ate silvicultural practices influencing water quality in a harmful way should be
avoided.
c. Construction of roads, bridges and other infrastructure should be carried out in a
manner that minimises bare soil exposure, avoids the introduction of soil into water-
courses and that preserve the natural level and function of water courses and river
beds. Proper road drainage facilities should be installed and maintained.

Criterion 6. Maintenance of other socio-economic functions and conditions

6.1 Guidelines for forest management planning
a. Forest management planning should aim to respect the multiple functions of forests to
society, have due regard to the role of forestry in rural development, and especially
consider new opportunities for employment in connection with the socio-economic
functions of forests.
b. Property rights and land tenure arrangements should be clearly defined, documented
and established for the relevant forest area. Likewise, legal, customary and traditional
rights related to the forest land should be clarified, recognised and respected.
c. Adequate public access to forests for the purpose of recreation should be provided
taking into account the respect for ownership rights and the rights of others, the
effects on forest resources and ecosystems, as well as the compatibility with other
functions of the forest.
d. Sites with recognised specific historical, cultural or spiritual significance should be
protected or managed in a way that takes due regard of the significance of the site.
e. Forest managers, contractors, employees and forest owners should be provided with
sufficient information and encouraged to keep up to date through continuous training
in relation to sustainable forest management.

6.2 Guidelines for forest management practices
a. Forest management practices should make the best use of local forest related experi-
ence and knowledge, such as of local communities, forest owners, NGOs and local
people.

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Forest management standards

b. Working conditions should be safe, and guidance and training in safe working
practice should be provided.
c. Forest management operations should take into account all socio-economic func-
tions, especially the recreational function and aesthetic values of forests by maintain-
ing for example varied forest structures, and by encouraging attractive trees, groves
and other features such as colours, flowers and fruits. This should be done, however,
in a way and to an extent that does not lead to serious negative effects on forest
resources, and forest land.

National laws, regulations, policies, programmes, international conventions

In addition to national laws, regulations, policies and programmes for forest management, inter-
national conventions form part of the national standard setting processes including the:
Convention on Biological Diversity,
Kyoto Protocol,
Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES)
and the
Biosafety Protocol.

The requirements agreed upon in the conventions, even if not ratified by the country, will be
respected in order to obtain PEFC Council endorsement.

The forest management performance standards of national forest certification schemes, which
apply for endorsement and mutual recognition with the PEFC framework, shall also respect the
Core Conventions of the International Labour Organisation (ILO). The core ILO Conventions are
as follows:
No 29: Forced Labour, 1930
No 87: Freedom of Associations and Protection of the Right to Organise, 1948
No 98: Right to Organise and Collective Bargaining, 1949
No 100: Equal Remuneration, 1951
No 105: Abolition of Forced Labour, 1957
No 111: Discrimination (Employment and Occupation), 1958
No 138: Minimum Age for Admission to Employment, 1973

In addition, the ILO Code of Practice on Safety and Health in Forestry Work is recognised as a
helpful document, which is recommended to be considered when developing national and
regional certification criteria.

Schemes development

In summary, the PEFC national certification system development follows the following pattern:
Stakeholders in each country develop the national (or regional) independent forest certification

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standard and scheme based on the MCPFE operational level guidelines or other intergovern-
mental processes promoting SFM, the national laws and regulations and the core ILO conven-
tions and others ratified by the country in question.

All relevant interested parties are invited to participate in this open and transparent process.
The participation of parties should provide for balanced representation of interest categories,
represent the different aspects of sustainable forest management and include, e.g. forest own-
ers, forest industry, environmental and social non-governmental organisations, trade unions,
retailers and other relevant organisations at national or sub-national level. The PEFC requires
that the formal approval of the standard is based on evidence of consensus according to ISO
Guide 2.

Schemes participating in the PEFC Council have to fulfil requirements, such as an open and
transparent process in the preparation and revision of the documentation, periodic review, a
consultation process and following the principle of continuous improvement.

Figure 8: Tasks of different bodies in PEFC certification

PEFC certification process - a summary

Separate bodies Action Result

National Forest Standard Setting Certification
Certification Scheme Standard/Scheme

Forest Certification
Certification Body Auditing
Chain of Custody
Certificate

National Assessment of Confirmation on
Accreditation Body Certification Body Accreditationof
Competence Certification Body

PEFC Council Licencing of Logo PEFC Logo on
Usage Products

Assessment of Mutual Recognition
Certification Scheme

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PEFC recognition and endorsement

Certification

PEFC relies on the credible implementation of a scheme by following internationally recognised
certification processes i.e. the use of independent certifiers accredited by national accreditation
organisations to certify to the scheme or chain of custody. They are completely independent of
PEFC and the certification system owners and have to follow the strict rules required by their
processes to maintain the credibility and quality of their work.

PEFC offers three forms of certification, individual certification, group certification and regional
certification (details see Annex 3 PEFC Technical Documentation). Re-certification takes place
every 5 years (maximum) with annual surveillance audits after an audit, which covers both
documentation review as well as on-site inspections.

The applied certification procedures fulfil or are compatible with the requirements of the Interna-
tional Organization for Standardization (ISO Guides 62, 65, 66).

Accreditation

There are governmental or semi-governmental institutions, like the Finnish Accreditation Service
(FINAS), the United Kingdom Accreditation Service (UKAS), the Swedish Board for Accredita-
tion and Conformity Assessment (SWEDAC), who have expertise from other sectors with certifi-
cation, ensure and control the qualification of certifiers and issue the necessary licences to
certifiers to certify. These national accreditation organisations are members of the International
Accreditation Forum (IAF), the world association of conformity assessment accreditation bodies
in the fields of management systems, products, services, personnel and other similar
programmes of conformity assessment. The purpose of IAF is to ensure that its accreditation
body members only accredit competent certifiers and to establish mutual recognition arrange-
ments, known as Multilateral Recognition Arrangements (MLA), between its members. Thus the
internal and external quality assurance of both certifiers and accreditors are guaranteed. Details
of the IAF are available at www.iaf.nu.

PEFC Council has committed itself to support the relevant objectives and obligations of IAF and
to abide by the requirements of the IAF Bylaws when it became an associate member of the
International Accreditation Forum in January 2004.

Both accreditation and certification bodies have documented procedures for complaints,
disputes and appeals open to all interested parties and individuals.

PEFC recognition and endorsement

Forest certification schemes seeking to be endorsed by the PEFC Council must be developed in
an open and transparent way through a multi-stakeholder process.

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National forest certification schemes that seek to be recognised by the PEFC Council and to
have access to the PEFC logo must fulfil all the PEFC requirements for forest certification
schemes defined in the PEFC Council Technical Document and relevant Annexes.

The assessment process is carried out by an independent consultant and includes a public
consultation period. The consultant assesses whether the system meets the several hundred
requirements of PEFC Council. The assessment report of the independent consultant on any
scheme seeking PEFC endorsement is made publicly available on the PEFC Council web page.

Based on this independent assessment and their own experiences, members and their stake-
holders are able to discuss the applicant scheme at a local level before submitting their final
vote on whether to accept an applicant scheme or not. In other words, in addition to an objective
independent analysis, this mutual recognition process also provides for the ultimate decisions to
be made by the national forums and their stakeholders. Stakeholder groups are expected to
participate at national level, but in addition international groups (Extraordinary Members) partici-
pate in debates as observers.

The endorsed forest certification systems must be reviewed at least every 5 years to incorporate
new experiences and scientific knowledge into the standards. The revised certification system
has to be submitted for re-endorsement.

Figure 9: PEFC endorsement process

PEFC Council Endorsement Process

Body Action Public participation

Scheme representative/ Application for the scheme
PEFC member endorsement

PEFCC Board of Appointment of
Directors independent consultant
All interested parties and
general public are invited
to participate in the scheme
Independent consultant Scheme assessment
assessment and their
comments can be sent to
the independent consultant
PEFCC Panel of Evaluation of the
Experts assessment report

PEFCC Board of Recommendation on the
Directors scheme approval

PEFCC General Decision on the scheme
Assembly endorsement

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International chain of custody

Product labelling

The PEFC Logo is a communication tool that companies can use on their timber, paper and
wood-based products to inform their customer base and final consumers about the origin of
wood raw material It allows customers and the general public to make a positive choice for
sustainable forest management.

Companies, who have a valid forest management certificate or a chain of custody certificate
issued by the certifier on behalf of the PEFC Council, can use the PEFC Logo optionally on or
off product (e.g. promotional material etc). The PEFC Logo usage license number must be used
together with the Logo. Details on PEFC Logo usage are described in Annex 5 of the PEFC
Technical Document.

PEFC has launched a fully interactive database on the PEFC website where anyone can search
and find information on any certificate or logo user relating to any forest or chain of custody
certification in every PEFC-endorsed certification system.

Figure 10: PEFC logo and market claims

Input-output and min. % systems Physical Separation

Promoting Sustainable Forest From Sustainably Managed
Management Forests
For more info: www.pefc.org For more info: www.pefc.org

International chain of custody

The PEFC international Chain-of-Custody (see Annex 4, PEFC Technical Document), to track
wood flows from certified forests to final consumers, can be used by all forest certification
systems worldwide, both within and outside the PEFC system, to verify the origin of procured
material Instead of having different national Chain-of-Custody standards for national systems,
PEFC provides one single common international Chain-of-Custody standard valid in all
countries. This holistic approach provides consistency and efficiencies for international compa-
nies operating in more than one country.

Its structure allows the international Chain-of-Custody standard to be easily implemented into
companies’ quality and environmental management systems e.g. the ISO 9001 and 14001

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standards. Group Chain-of-Custody certification is a cost effective solution available to small
companies.

The PEFC international Chain-of-Custody enables wood processing companies to procure
certified material from different countries using different national certification systems or labels
and to control the wood flow with only one Chain of Custody system. Once the percentage of
certified material coming from PEFC endorsed schemes reaches the required threshold of
70 %, companies can market the resulting products under the PEFC logo.

Stringent verification requirements for uncertified wood are mandatory in the Chain of Custody.
Companies that procure uncertified material from countries or regions with a higher risk of
unsustainable sources have to implement independent second or third party verification safe-
guards assuring the exclusion of illegally logged wood.

Others

PEFC Council is an accredited NGO with the United Nations Economic and Social Council
(ECOSOC) and an associate member of the International Accreditation Forum (IAF).

Conclusions

The PEFC Mutual Recognition process respects the political processes designed to promote
sustainable forest management developed by multi stakeholder involvement.

The PEFC mutual recognition process operates as a bottom up process, respecting the princi-
ples of subsidiarity, which are largely responsible for its success in delivering rapidly growing
quantities of timber from certified forests to the market place.

PEFC relies on the use of tried and tested certification and accreditation processes (which are
completely independent of PEFC) and which have their own rigorous procedures to ensure the
reliability, independence and credibility of their work.

The independence of the standard setting, accreditation, certification and of each scheme from
the PEFC Council is a strength of the PEFC system and assures credibility. Member schemes
can at anytime leave the mutual recognition framework provided by the PEFC Council. If they
leave, they have the advantage of still having a fully functioning independent national scheme
which has certifiers accredited by the national accreditation organisations. In other words they
remain fully operational, which would not be the case if PEFC were to provide the accreditation
for the certification bodies for example.

Extensive documentation of the PEFC system, current up-to-date information and details of
national certification systems, both endorsed and not yet endorsed, are available on the PEFC
website at www.pefc.org and by subscribing to the PEFC mailing list.

133
Notes

Notes
1
Acronyms used in the figure: Pan-European Operational Level Guidelines (PEOLG), International
Tropical Timber Organisation (ITTO), African Timber Organisation (ATO), Principles, Criteria and Indi-
cators (PCI), Criteria and Indicators (C&I), Sustainable Forest Management (SFM), Ministerial Confer-
ence for the Protection of Forests in Europe (MCPFE), International Labour Organisation (ILO).

References

PEFC (2005): PEFC Council Technical Document, Luxembourg (See website: http://www.pefc.org)

134
Lembaga Ekolabel Indonesia
Alexander Hinrichs

Lembaga Ekolabel Indonesia - Introduction and implementation of
forest certification in Indonesia
Alexander Hinrichs

The evolution of the forest certification system in Indonesia

On the way to the certification working group (1990 - 1993)

The debate on forest certification in Indonesia dates back to 1990. Two events in particular
were responsible. First, there were conferences in 1990 - including one in Bali - of the Interna-
tional Tropical Timber Organisation (ITTO), resulting in the adoption of the „Guidelines for the
Sustainable Management of Natural Tropical Forests” and an agreement that the producer
countries in ITTO should develop national guidelines for these. The Indonesian Ministry of
Forestry (MoF) declared its willingness to implement ITTO’s goal of broad introduction of
sustainable tropical forest management by 2000 („target 2000”). Second, for the first time in the
world, with the help of several Indonesian non-governmental organisations (NGOs), the US
NGO Rainforest Alliance with its SmartWood Programme certified a forestry operation - the
semi-nationalised Perum Perhutani company, which manages teak plantations on Java1. These
parallel developments of government interest in a positive high profile for Indonesia in the
context of the ITTO process together with hope of the young national NGO movement that it
could get publicity for social and ecological issues of forest management with the help of the
concept of certification brought the certification approach to Indonesia at a very early stage.

This was soon followed by market forces and the powerful Indonesian concession industry2.
Plywood production3, which had been booming for years, encountered the first interest in
certified wood products at the start of the 90s in the important US and European markets. In
1992 the umbrella organisation of the Indonesian wood industry, Masyarakat Perhutanan
Indonesia (MPI)4 set up a „Forest Certification” working group, which was coordinated by the
Indonesian concession holders’ association Asosiasi Pengusaha Hutan Indonesia (APHI) and
supported by the MoF and the Ministry of the Environment. Building on the ITTO guidelines, this
group concluded that the development of criteria for sustainable forest management would be
inevitable, and that APHI „should take the lead in developing these criteria rather than run the
risk of having them imposed on them“ (ELLIOTT 2000: 99). APHI accordingly developed a
„second-party verification” certification standard, and started carrying out conformity testing
among its member firms.

In April 1993 the newly appointed Minister of Forestry Djamaluddin Suryohadikusumo issued a
binding set of state criteria and indicators for sustainable management of the Indonesian natural
forest at national and company level (MOF 1993). Based on an analysis of the weaknesses of
the statutory forest environmental impact assessment in concession areas, the MoF called for
the development of an independent national certification system. With financial support from
MoF, the independent certification working group Klompok Kerja Ekolabel Indonesia (Indone-
sian Ecolabeling Working Group), also called Pokja Lembaga Ekolabel Indonesia (LEI working
group), formed at the end of 1993. The group consisted of prominent scientists and NGO repre-

135
The evolution of the forest certification system in Indonesia

sentatives, and was chaired by the former environment minister and Brundtland Commission
member Prof. Dr. Emil Salim.

The LEI working group sets itself the following goals:
formulating criteria and indicators for the management of Indonesian forests capable of
attracting a consensus,
developing a transparent verification process relatively invulnerable to corruption, and a
decision process along the same lines, and
preparing for the creation of an independent national certification organisation (SALIM et al.
1997).

The LEI working group becomes an institute (1994 - 1998)

Between 1994-1997 the LEI working group created a national certification standard and an
independent voluntary certification system within the context of the competing interests of
NGOs, concession holders and the ministries of forestry, trade and the environment. Numerous
workshops, hearings and field tests were held, with great attention being given to independence
vis-à-vis the wood industry and government agencies, and also vis-à-vis international organisa-
tions. Standards and systems were primarily developed by a small group of local experts
commissioned by the working group, and discussed with a larger group (which largely remained
the same over the course of standard development) of interested NGOs, scientists and
representatives of the private sector and forest administration.

In April 1997 the working group succeeded in obtaining recognition for the LEI standards for
natural forest management from the Indonesian concession holders’ association and the
ministries involved. APHI discontinued the use of its own standards and its work on „second-
party” certification. The standard for natural forest management was accordingly recognised in
June 1998 as a National Standard (SNI 19-5000-1-1998) by the Indonesian Standardisation
Organisation, the national representative to the International Organization for Standardization
(ISO). Reaching agreement on all this without changing the standard is a major negotiating
success for the small LEI working group in dealing with the powerful concession holders’ asso-
ciation. The MoF played the role of intermediary in this.

Until 1998, the LEI working group played a diverse role. In addition to serving as a standards
initiative, system developer and implementing certification organisation, it also saw itself as a
promoter for certification, sustainable forest management and political change. Forest certifica-
tion was seen as a marketing instrument, and also as „a means to effectively implement
commitment to Sustainable Forest Management, and commitment to Sustainable Development”
(SALIM et al. 1997: 6). LEI counted on indirectly influencing forest management and policy, on
„partnership rather than a confrontation and inspectorial approach” (SALIM et al. 1997: 6)5. The
approach aiming at political change in Indonesia was also the basis of the LEI working group’s
goal of developing an autonomous national certification system, instead of going with interna-
tional developments such as the Forest Stewardship Council (FSC), which was also formed in
1993. However, the LEI system was intended to be flexible enough to obtain recognition from a
number of international certification initiatives, in order to be accepted in the consumer markets.

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The first discussions with the FSC began in the mid-90s. A meeting in Rome in March 1998 led
to a statement of intent on „producing at a later date a memorandum of understanding on
mutual recognition”; (LEI 1998:1).

In its role as self-appointed promoter, the LEI working group started training Indonesian auditors
and national experts for work on the certification panels. With international support, LEI organ-
ised road shows on certification and sustainable forest management in various Indonesian
provinces. Harmonisation of standards, focused public relations work and increased
international contacts finally led on 6 February 1998 to the formation of the Indonesian
certification institute, the non-profit organisation Yayasan Lembaga Ekolabel Indonesia (The
Indonesian Ecolabelling Institute), generally simply known as LEI6.

The LEI institute adopted the following mission:
promote and implement policy aimed at sustainable resource utilisation,
develop credible certification systems for sustainable resource utilisation,
convert LEI to an accreditation organisation to monitor the implementation of national
certification,
establish the necessary institutional and human capacity for introducing credible national
certification (LEI 2002a: 6).

LEI establishes itself (1999 - 2004)

The MoF supported LEI’s work through regular participation in the workshops, although without
major influence on the content of its work. Discussions within the ministry on creating financial
incentive systems for certification led among other things to the announcement that certified
enterprises would be rewarded with simplified state monitoring.

In 1999 LEI carried out its first and last main assessment, resulting in certification of the PT.
Diamond Raya concession. Since then, LEI has been working exclusively as national
accreditation organisation and „Certification and Sustainable Forest Management (SFM)
promoter”, and has now recognised two national and two international certification organisations
for Indonesia7. To date, 300 people have been trained as national assessors by LEI.

In 1999 LEI also revised and significantly simplified its natural forest standard on the basis of
initial field experience and suggestions from national and international bodies. LEI acted as a
moderator here: „The results that come out of this multi stakeholder process, i.e., the Indone-
sian forest certification system, are regarded as stakeholders agreements or consensus.
Indonesian stakeholders in this context cover all organisations and individuals representing the
forest related businesses, governmental bodies, academics, and civil society groups that have
been participating in the open forums and process of developing Indonesian certification
system. This list can also be extended to foreign organisations contributing to the process”8.

In September 1999 LEI and FSC signed a memorandum on future cooperation. At the same
time, the four certification organisations accredited by LEI signed a Joint Certification Protocol
(JCP) with those FSC-accredited certification organisations already active in Indonesia, SGS-

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The evolution of the forest certification system in Indonesia

Qualifor and the SmartWood Programme of the Rainforest Alliance; this governed the details of
their cooperation in the field and how the processes would be streamlined. In September 2000,
October 2001 and March 2003 the JCP was internally evaluated, adapted and extended by the
participants9. LEI also made contact with the Programme for the Endorsement of Forest
Certification schemes (PEFC). LEI was recognised by the British retail chain B&Q already in
2000.

To date, 14 concessions with an area totalling c. 2.5 million hectares have been assessed
under the JCP. Only one - the PT. Diamond Raya concession (90,957 ha) - has so far met the
criteria of both certification systems and been recognised by LEI and FSC (1999). Four other
forestry operations (665,046 ha) met the requirements of the LEI system but not of the FSC
system, so that no certificates have been issued so far under the JCP agreement. In parallel,
SmartWood certified several Perum Perhutani plantations on Java and the PT. Xylo Indah
Pratama forest cooperative on Sumatra, all of which are outside the area of application of the
JCP. However, these were suspended again by mid-2003. LEI also certified two small
cooperative forests on Java in 2004, so that today there are only three LEI or FSC certified
forest operations in Indonesia after more than ten years of discussion on certification.

The certification debate has become highly politicised in recent years. First, MoF and the
concession holders’ association have tried in tandem with international organisations and
cooperative ventures to make the issue of certification more accessible to a broader public, and
to increase concession holders’ interest and knowledge of the issue10. In parallel with the rapid
social changes in the post-Suharto era (keywords: democratisation, decentralisation) and the
resulting loss of power of the MoF and the concession holders’ association, there has been a
significant increase in the criticism aimed at the forest industry (including forest certification) by
individual NGOs. LEI, which from the start had dedicated itself to participating in the political
decision-making process and accumulating social capital, was institutionally and organisation-
ally unequal to its goal in these turbulent times, and was unable e.g. to establish the regional
discussion fora provided for in the system and welcomed by the NGOs as bodies for consulta-
tion with stakeholders and for monitoring the work of certification organisations throughout
Indonesia.

LEI responded to criticism of LEI and forest certification in Indonesia by further developing its
system (creating a separate standard for plantations and community forests, introducing a
Certification Review Board and Forest Certification Monitoring Programme and developing a
phased approach for certification at the forest management unit (FMU) level). In addition LEI
held workshops on current forest policy issues, including illegal logging (causes, possibilities of
monitoring through log audit procedures) and the effects of decentralisation. Critics of certifica-
tion included numerous NGOs, which nevertheless participated in the development of the certi-
fication system for community forests, and signed special agreements for this with LEI in July
200211.

At the start of 2003 LEI announced that it was transforming itself into a constituent based
organisation. This announcement was positively received by all Indonesian NGOs. However,
internal evaluations concluded that it was necessary first to improve the organisation of work
and management capacity within LEI before such a sweeping move would be possible12. In

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October 2004 LEI finally presented a four-chamber concept for its constituent-based
organisation to 130 representatives of all the Indonesian interest groups at a national
certification congress. After detailed negotiations on the voting weights of each chamber, the
following system was adopted: one chamber for the concession industry (30% of the vote), one
chamber for the local population (35%), one chamber for interested parties (in Indonesian,
Pemerhati, a mix of representatives of NGOs and the forest administration, 20%) and a special
chamber for generally respected individuals (Indonesian: eminen person, 15%). The chamber
for the local population was given the biggest vote at the express wish of the NGOs. LEI
succeeded in this way in gaining even some of the previously critical NGOs as members, and
now hopes to be able to continue the debate about the future of certification in Indonesia in a
constructive manner within its own organisation. As a first step, the appointed chamber
representatives (10 individuals) will evaluate LEI’s entire programme, including cooperation with
the FSC. A meeting with the FSC is planned for mid-2005.

Since 2002 LEI has participated in the regular meetings of the Secretariat of the Association of
South-East Asian Nations (ASEAN) on developing a Pan-ASEAN Timber Certification Initiative.
Following the idea of a „phased approach” LEI supports the development of a regional
framework (minimum standard) for legality verification (legal compliance) of wood from ASEAN
member states for a start (ASEAN 2005).

LEI’s certification standards

To date, LEI has developed three forest certification standards and a chain-of-custody standard,
which are described in various primary documents (see table 1). In addition, LEI has developed
a log audit standard for checking the origin of wood used in the wood processing industry
(tested to date in two paper mills) and is working on developing criteria and indicators for sea
fishing.

Table 1: Key documents on LEI’s forest certification standards

LEI document Contents Adopted
Standard 5000 context document: sustainability standards in the production 1998
forest
Standard 5000-1 standard for sustainable natural forest management 1998, revised
1999
Standard 5000-2 standard for sustainable plantation management 2002/3
Standard 5000-3 standard for sustainable forest management by communi- in testing
ties and cooperatives
Standard 5000-4 standard for sustainable management of non-wood planned
products
Standard 5001 chain of custody standard 2002/3
Standard 5005 terminology 1998

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LEI’s certification standards

LEI’s standards are broadly performance based, i.e. their primary goal is to document the
effects of the forest management system at issue. In addition, analysis of documentation of
operational planning and control, company organisation and the relationship between operators
and the local population play a major role. The natural forest standard in particular is notable for
its applicability and comprehensibility.

LEI has produced high quality documentation of its extensive and carefully structured system for
forest certification. Detailed training materials were also produced for certification in production
forests (series 99) and chain-of-custody certification (series 88). There is also technical
documentation in the form of assessor manuals for fieldwork and guidelines for certification by
expert groups (LEI documents 01 - 04). Background material completes the system. All central
documents are available on the Internet at http://www.lei.or.id/indonesia/download.php in
Indonesian, with a limited number in English.

Standard for sustainable management of natural forest

LEI’s standard for natural forest management is aimed at the Indonesian concession holder
industry with areas between 40,000 and 250,000 ha. The content of the standard draws on the
criteria and indicators of the ITTO, ISO 9.000/14.000 series and the FSC principles and criteria,
but the standard has its very own structure. LEI divides the standard into the three sustainability
or results dimensions - production, ecology and social aspects. Each dimension is further
considered on three levels (management dimensions): establishment (area management),
division or stand level (forest management), and institutional level (organisation management).
This generates a matrix reflecting the structure for deriving criteria and indicators (see box 1).

For the natural forest standard, LEI initially developed 144 such indicators, which were simpli-
fied to 57 in 1999 as a result of greater field experience and stakeholder inputs. The standard
has numerous optional verification aids for each indicator, to be used like a toolbox; these are
explained in technical document LEI-01 (LEI 2000).

Standard for sustainable management of plantation forests

The plantation forest standard follows the structure of the natural forest standard. In formulating
it, LEI again drew on from the ITTO, FSC and ISO, with additional input from the Dutch founda-
tion Tropenbos and the International Labour Organisation (ILO). In all, 67 indicators were
derived (LE 2003). In contrast to the FSC, LEI accepts direct transformation of natural forest into
plantations, provided that this is done entirely legally and recognised by the affected local
population.

The standard has been repeatedly tested, but there has been no LEI certification of plantation
forests as yet.

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Box 1: Breakdown of LEI standard by management and results dimension

Management dimension:

a. area management : area demarcation and protection
b. forest management: forest output
c. organisation management: enterprise organisation

Results dimension:

1. sustainability of production
2. sustainability of environmental outputs
3. sustainability of social aspects

The matrix shows how the management and results dimensions are combined, with each indicator
an expression of this combination. The standard focuses on area and forest management.

Combination of management and results dimensions in the LEI system and the number of
derived indicators, taking the example of certification in the natural forest

Management dimension Results dimension
sustainability of sustainability of sustainability of
production (P) environmental social aspects (S)
outputs (E)
1. area management 6 INDICATORS 11 INDICATORS 4 INDICATORS
(P1.1 - P 1.6) (E1.1 - E 1.11) (S1.1 - S 1.4)

2. forest management 9 INDICATORS 8 INDICATORS 5 INDICATORS
2.1 production (P2.1 - P 2.9) (E2.1 - E2.8) (S2.1 - S 2.5)
management
2.2 environmental
management
2.3 social management

3. organisation 6 INDICATORS 0 INDICATORS 8 INDICATORS
management (P3.1 - P3.6) (since standard (S3.1 - S3.3)
revision) (S4.1 - S4.2)
(S5.1 - S5.3)

Source: AGUNG, HINRICHS (2000), revised

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LEI’s certification standards

Standard for sustainable management of community and cooperative forests

Community and cooperative forests still play a very minor role in Indonesia. LEI has worked for
certification of Community Based Forest Management (CBFM) primarily for political reasons. As
a result, LEI is working not only for certification of communities, but also for explicit promotion of
CBFM in Indonesia and fair benefit sharing.

The structure of the community forest standard is an effort to reflect the unique features and
diversity of Indonesian CBFM areas. Generally, community forest is divided according to the
form of land title into forest on state land, forest on community land (as property of the
community and cooperative), and forest on private land. There is a further division based on the
production goals into commercial production and production for subsistence, and based on the
legal status of the forest area into production forest, protection forest and conversion forest. The
result is 24 categories in a community forest typology, although no distinction is made between
community management of natural forest and planted stands (LEI 2004). Before starting
certification, it is necessary to determine the type of community forest, as this affects not only
the certification procedure and relevant standards, but also whether an area is suitable for
certification at all. For example, LEI shall not legitimise any use of protected forests, even by
communities.

The wide range of possibilities does, however, mean the system only partly achieves one of its
goals - simplicity. To keep certification of community forest acceptable in terms of costs, LEI has
developed a verification procedure for specific cases which is based on statements by a
generally recognised individual or organisation acting as a guarantor. This procedure was
accepted from the start in the course of extensive public hearings involving NGOs, community
representatives and LEI, which have taken place since 2000 for CBFM certification.

Initial experience in West Kalimantan and particularly on Java shows that the organisational
prerequisites for certification in community forest are frequently lacking13. In addition, the
sustainable wood supply is extremely modest in most Indonesian communities, so that larger
marketing associations are needed. LEI and the World Wide Fund for Nature (WWF) are trying
to develop marketing aids for wood from CBFM areas.

Two certifying bodies accredited by LEI (PT. Mutu Agung Lestari and PT. TÜV International)
have now had themselves accredited for certification in community forest. In October 2004
forest management of two villages in East Java was certified for the first time by LEI14.

The certification process for natural forest in the LEI system

As the national accreditation body, LEI entrusts certification to its accredited certification bodies,
which enter into contracts directly with the forest enterprises. An accreditation manual details
the requirements for independence and professionalism of certification bodies and their internal
quality management. The specifications of ISO (documents 61, 62) were incorporated. For
example, communication between the certifying body, the accreditation body (LEI), the regional
discussion fora and the dipute resolution council is specified exactly.

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The LEI certification process reflects the attempt to establish a system which is as robust and
invulnerable to corruption as possible, and which takes into account the special features of the
country and poor experience with other audit procedures. There are six stages in the procedure:
(1) pre-audit (screening process)
(2) main audit (field assessment)
(3) analysis and evaluation of the field assessment
(4) certification
(5) monitoring audit (surveillance)
(6) conflict resolution.

(1) Pre-audit
A pre-audit is carried out to determine whether a forest enterprise is suitable for certification at
all, in order to keep costs and time spent to a minimum. LEI assigns performance and
evaluation of the pre-audit to an independent expert panel (Expert Panel I) with at least three
members, formed on a case-by-case basis by the certification organisation involved. The
experts must be technically competent and independent of the forest enterprise to be audited,
and be specially licensed by LEI. Their primary task is to analyse operational documents
(statements of corporate philosophy, management plans, environmental impact assessments,
monitoring reports etc). If necessary, the experts can make a short field visit (field scoping).

Expert Panel I decides on the basis of the documentation and impressions from an optional field
visit whether the forest operation is suitable for a main audit. If so, the panel makes
recommendations in its report for the work of the assessors.

The pre-audit is an internal process, i.e. there are no formal stakeholder hearings, and the
results are not published.

(2) Main audit
The certifying body assembles the team of assessors and publicly announces its work. This is to
enable it to work together with the regional discussion fora created by LEI15. The regional
discussion fora are meant to contribute their local experience, make important contacts, inform
stakeholders of the certification process, help in case of conflict, and generally support the work
of the certifying organisation and LEI.

The team consists of at least three assessors (corresponding to the results dimensions produc-
tion, ecology, and social affairs). Assessors must be registered with LEI and trained in certifica-
tion by LEI, and must have at least three years’ professional experience. They should also have
regional experience. LEI can send its employees at any time to a field assessment as observers
or moderators, which enables it to monitor the work of the certifying organisations. If the forest
enterprise has no objections, observers from interested groups are also permitted.

The assessor team analyses the forest operation with the help of documents, forest visits and
stakeholder hearings. It generally makes qualitative assessments, i.e. measurements are made

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The certification process for the
natural forest in the LEI system

only in rare instances. The resources needed for the audit are somewhat greater than in
comparable FSC certification. The team is also responsible for assigning the operation to a
specific type16. Stakeholders can participate in a number of ways: through the planned formal
hearings at national, province and/or district level, through meetings with representatives of the
regional discussion fora and in writing.

The assessor team draws up an audit report containing for each of the 57 indicators a
description of the situation and a provisional evaluation by the team.

(3) Analysis and evaluation of the field assessment
LEI assigns the final analysis and evaluation of the enterprise to another independent expert
panel (Expert Panel II), to be assembled on a case by case basis by the certifying organisation
handling the contract. The Expert Panel II consists of the members of Expert Panel I and at
least three more experts. In selecting the experts, local knowledge plays a role in addition to
professionalism and independence. The team leader for the field assessment reports to the
expert panel, and can also be a member of this, but does not participate in the final evaluation.
A representative of the forest enterprise can also submit a statement on the audit report. LEI
itself can moderate the work of the Expert Panel II, enabling it to monitor its independence.

The evaluation of the Expert Panel II is based on three sources: the results of Expert Panel I,
the report of the assessor team, and stakeholder inputs, which are possible at any time. Expert
Panel II makes its recommendations on the basis of a highly formalised process of analysis
known as analytical hierarchy process. This compares the field situation at indicator level with
the minimum standard set in advance for each type of operation. The weighting of the
evaluation of the indicators also depends on the type of operation, where the enterprise can in
principle offset a shortfall in one results dimension through good performance in another results
dimension. In contrast to the FSC concept, the decision is simply pass or fail, with no conditions.
If the enterprise falls short of the target for certification, it has six months for improvement before
a repeat field assessment. If it exceeds this period, the process is ended.

(4) Certification
The decision on awarding a certificate is made by the certifying organisation concerned, which
follows the recommendation of Expert Panel II. The certificate is valid for five years. There are
five levels of certificate (from zinc to gold). The certification decision is public.

(5) Surveillance
LEI’s certifying organisations carry out regular monitoring audits, with a frequency depending on
the level of certificate. Expert Panel II prepares these audits by drawing up a priorities list and
main audit indicators. The results of the surveillance audit itself need not be evaluated by an
expert panel.

(6) Conflict resolution
LEI has set up a permanent independent dispute resolution committee to handle objections, the
Certification Review Board. Forest enterprises along with all other stakeholders can approach
this board directly. The Certification Review Board is responsible for examining objections in

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Alexander Hinrichs

cooperation with the relevant regional discussion fora and in case of doubt can modify the certi-
fication decision. The tribunal is made up of prominent personalities from the world of science
and NGOs, some of whom also belong to the eminem person chamber.

As noted above, certification in the natural forest in Indonesia has been carried out since 1999
under the Joint Certification Protocol (JCP), a voluntary agreement between LEI accredited
certification organisations and individual FSC accredited certification organisations. The JCP
provides for steps 1, 2 and 5 of the LEI certification system to be carried out jointly, subject to
the LEI-5000-1 standard, supplemented by elements specific to FSC. Certification is only possi-
ble if both systems are satisfied. The LEI and FSC certification organisations accordingly plan
their work together, sending a joint team out for the pre-audit and main audit17. This has had
significant learning effects for both sides, and improved understanding of the systems. However,
it has also increased the costs of certification.

Differing attitudes to certification in Indonesia

Continuing discussions about indigenous land rights in concession areas, lack of political vision
and regulations charged with conflict, miserable performance by many concession holders,
widespread and growing illegal logging, all anchored in a system of corruption and nepotism,
set the context for implementing forest certification in Indonesia. The rapid decentralisation of
large parts of central state power to district level at the start of 2000 also led to major insecurity
in state structures and the private sector. This situation is more than unhelpful for introducing
innovative concepts of resource utilisation.

Attitudes to forest certification are divided in Indonesia today. Although there are many different
positions, we will attempt to group them for simplicity into supporters and critics. First, there are
the supporters, whose position has been significantly strengthened by LEI’s transformation into
a constituent-based organisation. For example, the Joint Communiqué on Calls for Rescuing
Indonesian Natural Resources by the government, NGOs, representatives of indigenous groups
and the private sector on 22 October 2004 emphasises the important role of certification in
resource conservation and social issues (particularly with reference to working conditions).

Positions of supporters

Supporters are individual national NGOs (including The Indonesian Tropical Institute (LATIN)18,
The Indonesian Network for Forest Conservation (SKEPHI)), employees of innovative conces-
sions and the concession holders’ association, employees of the certification organisations, and
independent individuals, particularly from fields of science. In addition there are representatives
of some international programmes and organisations such as the Tropical Forest Trust (TFT),
Tropical Forest Foundation (TFF) and The Nature Conservancy (TNC). All the organisations are
distinguished by experience in development and or implementation of certification in Indonesia,
and have field experience in concessions. There are also two working groups in Indonesia for
promoting forest certification - the Certification Practitioners Group in Jakarta and the producer
group Kelompok Kerja Sertifikasi in East Kalimantan19.

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Differing attitudes to certification in Indonesia

Simplifying, the supporters of forest certification in Indonesia see the positive impacts as
follows20:

(1) Promotion of participative mechanisms
The LEI certification process, further strengthened by the JCP, attaches great importance to
participative mechanisms. Stakeholders are involved at all stages of certification, in standards
development, before and during the audits, and in case of conflict. By the nature of the process,
LEI and FSC compel concession holders to disclose their management to the local population
and interested public. This for the first time creates the transparency in the sector that has been
called for for years, and persuades the concession holders to cooperate in consultative
processes. Supporters of certification cite cases where the relationship between concession
holders and the local population has visibly changed for the better in connection with
certification, even though the past cannot be simply wiped out.

(2) Improvement of concession management
The forest enterprises interested in certification to begin with come from a small group of
innovative concessions (a few percent of Indonesian enterprises). They have downstream
industries with an international alignment. Supporters of certification note that these enterprises
are ready to plan intervention for a longer term and invest in improving their forest management
and their human resources (further training, accident prevention). Their willingness to invest in
ecological and social aspects of forest management as well is significantly greater than that of
other concession holders, who are out of reach of either certification or state control, and whose
„hit and run“ management style invites criticism of the concession system.

Through their own internal audits (self scoping), assessor training, LEI-FSC certification audits
and external consultants, the innovative enterprises have in the course of the debate over certi-
fication learned much about the concrete content of sustainable management eligible for
certification, its introduction and its control procedures. They have realised that greater
transparency of planning and implementation is needed, and know that companies certified
under the JCP have to meet more stringent technical requirements than statute requires
(keywords: reduced impact logging, comprehensive control of environmental impacts,
acceptable conflict resolution, verifiable internal chain of custody, effective combatting of illegal
logging). International projects in the last few years have built up substantial capacity in these
areas in particular, and their implementation can be helped by forest certification21.

(3) Influencing forest policy
The supporters of certification expect that forest certification will have a positive influence on
forest policy through the public definition of management standards, the increase in company
transparency, and the unvarnished feedback on the situation in the field. One of LEI’s goals is to
do this. At the national level, there was discussion even before decentralisation of incentives for
promoting certification, and there are examples at local level where national and local figures of
power have made positive statements about certification, third-party auditing and participative
approaches to conflict resolution22. Given the dramatic (illegal) scale of destruction of forests in
Indonesia, and the increased weakness since decentralisation of state structures, these

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Alexander Hinrichs

approaches are among the few positive developments, and should accordingly be supported, as
the proponents of certification see it.

(4) Promotion of community forests
In the view of the supporters, certification in community forests raises the profile of community
forest management in Indonesia and can help communities obtain legal recognition for their
traditional forest management. Certification also provides a systematic and nonstatal framework
for setting standards in community enterprises for the quality of acceptable forest management
and its organisational prerequisites. It accordingly works hand in hand with the numerous
national and international projects and initiatives for promoting this - still minor - form of forest
management in Indonesia.

Positions of critics
Critics of certification in Indonesia include the national NGOs Friends of the Earth Indonesia
(WALHI) and the Alliance of Indigenous People of the Archipelago (AMAN), formed in 199923.
They are supported by international NGOs, including some which are among the severest critics
of forest certification, such as Rainforest Foundation, Rainforest Action Network and Down to
Earth Network, which is very active in Indonesia. Most critics have a good picture of the situa-
tion of the indigenous population, but have virtually no direct experience of implementing forest
certification in the country.

NGO criticism dates back to 2000, when a letter of 13 September from WALHI to FSC, LEI, their
certification organisations, as well as GTZ and the TNC voiced concerns about the interpretation
of the certification standard and the lack of consideration given to the criminal past of the
concession holders. WALHI demanded more influence on certification work (LEI responded by
creating the Certification Monitoring Programme). A further letter by several international NGOs
to the FSC dated 9 September 2000 said: „In our opinion, no certification intended to respect
local peoples' rights can be carried out in any concession before the whole concession system
has been revised and the boundaries of indigenous peoples’ land have been defined and
recognised. We therefore call on you to stop all certifications of logging concessions in
Indonesia until such time as the legal position of local community rights has been fully
recognized.“24 In March 2001, at a workshop organised by WALHI, 115 national signatories
joined in the call for a temporary stop to certification.

The basic idea of the moratorium is not a general rejection of the certification approach (and
particularly not for community forests25), but is based on the demand made at the same time by
WALHI and its international NGO partners for a logging moratorium in Indonesia until the
political conditions for good forest management are established, and particularly until legal
recognition of indigenous peoples’ land rights is announced or even implemented. Many of the
Indonesian NGOs, again with support from international initiatives, also reject the concession
system as a whole, and see certification of large concessions as legitimating the system, rather
than improving forest management. There is also isolated criticism that the certification process
in Indonesia is too much an insider affair, and that many NGOs know too little about this or are
too little involved26. International certification bodies are also accused of not having made
enough effort to engage in appropriate consultation or initiate open debate about the imple-

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Differing attitudes to certification in Indonesia

mentation of the FSC certification standards under Indonesian conditions (COLCHESTER et al.
2003)27. LEI is also criticised by local NGOs for the fact that the creation of regional discussion
fora is lagging well behind expectations.

The link between FSC certification and indigenous land rights was investigated in an extensive
study commissioned by WALHI and the results were presented to the public at a major work-
shop in January 2003. The study analyses the political and legislative framework in terms of
FSC principles 2 and 3 (i.e. not in terms of the LEI 5000-1 standard) and concludes, „the current
Indonesian forest policy environment is difficult for, even hostile to, certification to FSC
standards“. The study's core statement is that the unresolved situation regarding land rights in
Indonesia and legal questions about the legitimation of the concession system make a certifica-
tion moratorium necessary: „an urgent and required next step must be to embark on a national
dialogue to decide how and whether to promote voluntary certification in Indonesia using inter-
national standards such as those of the FSC. Until such a national dialogue has been held and
a national consensus achieved on the way forward, FSC certification processes in Indonesia
should be suspended” (COLCHESTER et al. 2003: 18, 24)28.

Conclusions and prospects

Ten years after the start of the LEI certification working group, the debate in Indonesia is back
at the start: a fundamental discussion on the sense and purpose of forest certification. Although
LEI has since developed a well-thought-through, practicable and widely recognised certification
system and acquired some influence on the sector, there is currently little reason for satisfaction
for LEI. Implementation of certification has come to a halt - only one area in the natural forest is
still certified (the FSC certificates for plantations and the community forest were suspended for
performance reasons), and LEI’s certification in the community forest is still in its infancy,
despite the award of two certificates. The concession holders have become reticent in view of
their own uncertain future, financial bottlenecks (competing wood from illegal logging is consid-
erably cheaper) and the lack of market incentives. As expected, the call for a logging morato-
rium was not taken up by the MoF, and progress in the discussion of land rights is also minimal
The national dialogue proposed by WALHI on forest certification has not emerged so far.

Certification has attracted much attention in Indonesia from a very wide range of organisations.
It seems that supporters and critics both wish to attach a large number of different issues to the
specific topic. The certification debate has certainly led to changes in thinking and acting in
Indonesia, and brought a new definition and recognised structure to the requirements for good
forest management. Certification has also proved the only instrument to date which has
seriously affected the private sector.

The current situation helps us to a better understanding of the limits and possibilities of the
certification concept. Certification was developed as an approach by the market and civil society
outside state structures, and builds on voluntary innovation by individual forest enterprises,
irrespective of their ownership. It cannot be a panacea for solving all the many and varied forest
policy problems in Indonesia, let alone all the tropical nations. Certification requires a
supportive political environment which has to be established by other instruments. Certification

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can, however, help in two respects. At the field level, its contribution consists of providing a
model by creating individual case by case solutions in innovative enterprises. Doing this it can
easily raise problems which it is unable to deal with itself. These include the unresolved legal
questions of the concession system in Indonesia, where an individual solution is entirely
possible. At the social level, certification - at least as it is understood by LEI and FSC - requires
broad public discourse on the goals of the forestry industry. In a complex situation such as
Indonesia, such discourses are extremely complex and not easy to bring to a conclusion. As a
result, they are also extremely expensive.

Its regained acceptance among the ranks of the critics of certification has consolidated LEI’s
position again. We must hope that LEI will ease the tensions surrounding forest certification in
its new role as a constituent-based organisation, and that it will also be able to serve its political
goals better. It may help if LEI were to lay more stress on the opportunities and limits of
certification in Indonesia in connection with other international instruments (e.g. Convention on
International Trade in Endangered Species of Wild Fauna and Flora, CITES; Forest Law
Enforcement, Governance and Trade, FLEGT) and national processes (e.g. decentralisation,
CBFM), and to continue to contribute actively to the regional discussion about the legality of
wood products in the context of ASEAN and the Asian Forest Partnership Programme.

149
Notes

Notes
1
Perhutani manages around two million hectares of plantation in 54 forest districts. The main tree
species are teak, pine and mahogany. For more detail, see SMARTWOOD (2001b).
2
In 1990 there were 564 concessions covering 59.62 million hectares granted to national companies,
often conglomerates close to the government.
3
Indonesia’s plywood exports rose between 1982-1994 from USD 500 million to USD 4 billion.
4
MPI includes among other organisations APKINDO (Indonesian Wood Panel Association), ISA
(Indonesian Sawmill and Wood Working Association), APHI (Association of Indonesian Forest
Concession Holders), AIFTA (Association of Formalin and Thermosetting Adhesives Industries) and
ASMINDO (Indonesian Furniture Industry and Handicraft Association).
5
Loc. cit.: „Indonesian ecolabel system promotes co-operation, mutual understanding and partnership
among the various stakeholders of the forest…It is therefore in Indonesia’s highest interest to develop
timber certification as a means of achieving the nation’s SFM objective”.
6
The foundation is chaired today by Djamaluddin Suryohadikusumo, who as Minister of Forests in 1993
cleared the way for independent certification in Indonesia with Prof. Emil Salim.
7
These are: PT. SUCOFINDO, PT. MUTU AGUNG LESTARI, PT.TÜV INTERNATIONAL INDONESIA
and SGS INDONESIA, of which the latter discontinued its work as a forest certifier in Indonesia in
2003.
8
Dr. Mubariq, LEI’s director at that time, in an e-mail dated 23 December 1999 explaining the
Indonesian certification process to the national and international certification community.
9
In 2001 there was a survey of certification organisations, assessors, consultants and concessions, see
HINRICHS (2001).
10
Support came e.g. from ITTO, GTZ, Ford Foundation and the Department for International Develop-
ment (DFID): Among other events, GTZ organised an Awareness Conference on Forest Certification
in Indonesia in September 2000 together with MoF and LEI, and produced a „self scoping” manual to
make certification clearer to forest enterprises (cr. AGUNG, HINRICHS 2000). ITTO directly supported
LEI and APHI for a training programme with concession holders. DFID and the Ford foundation
supported multi-stakeholder meetings on the topic.
11
The NGOs are World Wide Fund for Nature (WWF), Volunteers Alliance for Saving Nature (ARUPA),
The Association for Economic and Social Development Studies (PERSEPSI), Community-based
Forestry Management East Kalimantan (SHK Kaltim), Alliance of Indigenous People of the
Archipelago (AMAN) and the Indonesian Consortium for Supporting Community-based Forestry
System Management (KpSHK).
12
LEI, personal communication.
13
LEI is working in Java on a pilot project with support from WWF and GTZ together with the Indonesian
NGOs ARUPA and PERSEPSI on assisting villages with sustainable forest management. A special
training programme was developed for this and a number of studies prepared. The Tropical Forest
Trust (TFT) on Sulawesi is also working on this.
14
This involves the villages of Sumberejo and Selopuro (810 ha) promoted under the pilot project.

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15
The Joint Certification Protocol states: „Public consultation is a fundamental component of the FSC
and LEI systems and therefore also of the JCP. It starts with a joint public announcement a minimum
of 30 days before a field assessment takes place and should be in coordination with Regional
Communication Forum (Forum Konsultasi Daerah/FKD), if possible. FKD representatives will be
informed 10 days prior to the public announcement. Consultation must take place on national, provin-
cial and district levels. All interested stakeholders shall be involved“ (JCP 2003: point 9).
16
Depending on the type of operation, Expert Panel II gives different weightings to the results for the
individual results dimensions.
17
The decision making process, where there is a significant difference between the LEI and FSC
concepts, still proceeds independently and separately. The forest enterprise receives two separate
audit reports.
18
Latin worked closely with SmartWood in Indonesia in the 90s.
19
The Certification Practitioners Group arose in 2000 out of a SmartWood initiative (contact praktisi-
sertifikasi@yahoogroups.com) as a loose association of individuals and organisations interested in
certification. It meets at irregular intervals in Jakarta and does not have an infrastructure of its own.
The certification working groups in East Kalimantan arose in 1998 out of a suggestion by GTZ and
maintains its own secretariat in Samarinda (contact: kkskaltim@yahoo.com). Its main responsibility is
information work on certification and sustainable forest management in the concession sector and
local administrations.
20
The following points draw on internal and unpublished discussions within the Certification Practitioners
Group over the course of 2003.
21
There are or were close relationships between many international projects and programmes and
concessions, e.g. through the Centre for International Forestry Research (CIFOR) to Inhutani II,
through GTZ to Sumalindo and the Kayu Lapis group, through the European Union (EU) to Inhutani I,
the Dwima group and the Barito group, through TNC and TFT to numerous concessions in East
Kalimantan and through TFF and a Reduced Impact Logging Training Programme to numerous
concessions throughout the country.
22
MoF issues e.g. exceptional regulations for certified enterprises on logging (permits for certified
enterprises to log Ramin (Gonystylus bancanus)) and special treatment under the „soft landing”
concept for reducing the national annual allowable cut. MoF has also developed its new concession
control system („mandatory verification”) as a third-party auditing approach which is implemented
among others by certification organisations accredited by LEI.
23
Since October 2004 the networks have belonged to LEI’s social chamber (AMAN) or the chamber for
interested persons (WALHI).
24
E-mail from Liz Chidley, Down to Earth; Simon Counsell, Rainforest Foundation UK; Jessica
Lawrence, Rainforest Action Network, Lars Loevold, Rainforest Foundation Norway and Kim Loraas,
Friends of the Earth Norway to the FSC Board of Directors. See also DOWN TO EARTH (2001).
25
The same e-mail calls on the FSC to develop a separate certification standard for community forests
with LEI.

151
Notes

26
This argument may seem surprising considering how much LEI has tried to involve interested groups.
As the FSC in agreement with LEI did not try to set up a national working group, there is still no infor-
mation about its work and the impacts and future of the JCP.
27
The efforts of FSC, LEI and particularly SmartWood (e.g. in SMARTWOOD 2001a) to explain the prac-
tice of certification in Indonesia in detail met with little response.
28
The study deals only marginally with the LEI system. However, the proposed FSC certification morato-
rium applies to LEI as well because of the JCP.

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References

AGUNG, F. / HINRICHS, A. (2000): Self-scoping Handbook for Sustainable Natural Forest
Management Certification in Indonesia. SFMP Project (MoF-GTZ). Document 6/2000.

ASEAN (2005): Report of the 5th Meeting of the Ad-Hoc Working Group on a PAN-ASEAN
Certification Initiative. In preparation.

COLCHESTER, M. / SIRAIT, M. / WILARDJO, B. (2003): Application of FSC Principles 2 & 3 in
Indonesia: Obstacles and Possibilities.

DOWN TO EARTH (2001): Certification in Indonesia: A Briefing. June 2001.

ELLIOTT, C. (2000): Forest Certification: A Policy Perspective. CIFOR, Bogor.

HINRICHS, A. (2001): JCP Evaluation. Input Paper to the 3rd JCP Meeting in Bogor 2001.

LEI (1998): Minutes of meeting between YLEI Board of Trustees and FSC, Rome, March 1998.

LEI (2000): Sistem Sertifikasi (certification system). 4 vols. Standard Seri 5000, Seri 99, Seri 55
and Dokumen Teknis 01&02.

LEI (2002a): Annual Report 2001.

LEI (2002b): Pilot Proyek Sistem Sertifikasi PHBML & PHTL (pilot project community forest and
plantation certification).

LEI (2003): Standar LEI 5000-2: Sistem Pengelolaan Hutan Tanaman Lestari (standard for
plantation certification).

LEI (2004): Kerangka Sistem Sertifikasi Pengelolaan Hutan Berbasis Masyarakat Lestari
(framework for community forest certification).

MOF (1993): Surat Keputusan (SK) 252/1993, SK 576/1993 and SK 610/1993: “C&I of Natural
Production Forest Sustainability on National Level” and „Sustainable Management of Natural
Production Forest on Management Unit level”.

JCP (2003): Joint Certification Protocol (JCP) between LEI-accredited Certification Bodies and
FSC-accredited Certification Bodies.

SALIM, E. / DJALINS, U. / SUNTANA, U. (1997): Forest Product Trade and Certification: an
Indonesian Scheme. Paper at the World Forestry Congress in Antalya.

SMARTWOOD (2001a): SmartWood Update on currently certified FSC teak plantations and
SmartWood certified Chain of Custody companies using FSC teak.

SMARTWOOD (2001b): SmartWood memo to WALHI, Down to Earth, Rainforest Foundation,
Forest Monitor, Global Witness and other international NGOs, 31 January 2001.

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MTCC timber certification scheme
Chew Lye Teng / Harnarinder Singh

Establishment of MTCC

The Malaysian Timber Certification Council (MTCC) was established in October 1998 to
develop and operate a voluntary national timber certification scheme in Malaysia. The formation
of MTCC was the result of discussions among government ministries, forestry departments,
academic and research institutions, environment department, timber promotion bodies,
standards institute, timber industry associations and environmental non-governmental organisa-
tions (NGOs) regarding the need to establish an independent and new organisation to develop
and operate the national timber certification scheme.

Starting off as the National Timber Certification Council, Malaysia (NTCC, Malaysia), it changed
its name to MTCC in June 2001. MTCC is incorporated under the Companies Act 1965 as a
company limited by guarantee, and started its operation in January 1999. The MTCC timber
certification scheme started operating in October 2001.

The MTCC scheme is therefore a national certification scheme run by an independent purpose-
created organisation (MTCC) that appoints registered third-party assessors to carry out
assessments for certification purpose, and issues certificates for forest management and chain-
of-custody. It also facilitates consultation among all stakeholders in Malaysia on timber certifica-
tion, including the formulation of standards related and keeping them under review periodically.
However, as preparation for endorsement of the scheme under the Programme for the
Endorsement of Forest Certification schemes (PEFC), MTCC intends to focus on its role as the
national governing body (NGB) while the assessors will be the certification bodies (CBs) which
will be accredited by the national accreditation body (Department of Standards Malaysia, DSM).

The MTCC certification scheme covers the three regions in Malaysia, i.e. Sabah, Sarawak and
Peninsular Malaysia. The forest management standard used, the Malaysian Criteria and
Indicators for Forest Management Certification (MC&I), applies to the three main forest types
(Dry Inland Forest, Peat Swamp Forest and Mangrove Forest) found in the natural forest in
Malaysia.

Structure and governance of the scheme

MTCC is governed by a Board of Trustees, comprising a Chairman and eight other members,
which decides the overall policy and direction in carrying out MTCC’s activities. In addition to the
Chairman, the members comprise two representatives each from academic and research
institutions, the timber industry, NGOs and government agencies, who are appointed by the
Chairman for a two-year term. The Board meets four times in a year, and decisions are made by
consensus.

155
Structure and governance of the scheme

A Certification Committee, established by the Board, has been given the responsibility to (i)
decide on applications for forest management and chain-of-custody certification, based on
assessment reports submitted by the independent assessors; (ii) decide on the registration and
de-registration of the independent assessors; and (iii) consider applications for registration as
peer reviewers.

The Certification Committee comprises four members of the Board representing each of the
stakeholder groups. Appeals against the decision of the Certification Committee are considered
by a committee comprising the other members of the Board.

The day-to-day operation of MTCC is managed by a chief executive officer, who is assisted by a
senior manager, two managers and four executives, together with five administrative staff. The
MTCC management is responsible for implementing the decisions made by the Board.
Decisions of the Board which are relevant to the stakeholders are communicated to them
directly as well as through the MTCC web site and other means such as press releases.

Standard for forest management certification

The MTCC certification scheme is being implemented using a phased approach which involves
the use of different forest management standards in the two phases. The standard currently
being used for assessing Permanent Reserved Forests (PRFs) in Forest Management Units
(FMUs) is the Malaysian Criteria, Indicators, Activities and Standards of Performance for
Forest Management Certification [MC&I(2001)]. The MC&I(2001) is based on the 1998 Inter-
national Tropical Timber Organization (ITTO) Criteria and Indicators for Sustainable Manage-
ment of Natural Tropical Forests. It incorporates the corresponding standards of performance
for Sabah, Sarawak and Peninsular Malaysia which were identified during the regional and
national level multi-stakeholder consultations held in 1999. The stakeholder groups involved in
these consultations were from government agencies, academic and research institutions,
workers’ unions, environmental NGOs, local communities, timber industry associations,
women’s organisations and timber promotion bodies.

The MC&I(2001) contains the key elements for sustainable forest management covering
economic, social and environmental aspects. These are elaborated under six Criteria and 29
Indicators that deal with the enabling conditions for sustainable forest management, forest
resource security, flow of forest produce, biological diversity, soil and water, and economic,
social and cultural aspects.

For the next phase of its certification scheme, MTCC will be using a new standard, the
Malaysian Criteria and Indicators for Forest Management Certification [MC&I(2002)],
which has been developed using the Principles and Criteria of the Forest Stewardship Council
(FSC) as the framework. Similarly, the development of the MC&I(2002) involved broad-based
consultation and consensus between social, environmental and economic stakeholder groups
through several meetings of the multi-stakeholder National Steering Committee (NSC) that was
formed to facilitate the MTCC-FSC cooperation (mainly through standard setting)1, and regional
consultations held separately in Sabah, Sarawak and Peninsular Malaysia. These consultations
culminated in the national-level consultation held in October 2002 where the representatives of

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Chew Lye Teng / Harnarinder Singh

all the stakeholder groups from the three regions met to finalise and adopt the national
standard.

The MC&I(2002) covers Principles 1-9 of the FSC (for natural forest) which have been elabo-
rated into 47 Criteria and 100 Indicators with their corresponding regional Verifiers for
Peninsular Malaysia, Sabah and Sarawak. The Verifiers contained in the MC&I(2002) reflect the
requirements necessary to address the social, environmental and economic dimensions
pertaining to sustainable forest management.

MTCC has set a target date of January 2005 to use the MC&I(2002) nation-wide. It is envisaged
that the certification standard will be reviewed every five years following its initial use.

Both the standards under the MTCC scheme are performance-based standards for assessing
the FMUs for forest management certification. The performance requirements are expressed as
„Standards of Performance” in the MC&I(2001) and as „Verifiers” in the MC&I(2002).

The certification process

Figure 1: MTCC timber certification scheme

Department of Standards Malaysia
(national accreditation body)

Malaysian Timber Certification Council
(timber certification organisation)

Peer
Reviewers

Forest Timber Product
Independent Management Unit (FMU) Manufacturer/Exporter
Assessor
(applicant)

Under the scheme which is outlined in Figure 1, MTCC as the timber certification organisation
receives and processes applications for certification (from FMUs in the case of forest manage-
ment certification and from timber product manufacturers or exporters in the case of chain-of-
custody certification), arranges for assessments to be carried out by registered independent
assessors, and prepares evaluation reports based on the assessment reports, client’s
comments and peer review comments (in the case of forest management certification) which

157
The certification process

are submitted to its Certification Committee who decides on whether an application merits an
award of a certificate.

The original plan was for MTCC, as the certification body (CB), to be accredited to DSM, which
is the national accreditation body in Malaysia. However, as explained in the last paragraph
under „Accreditation”, MTCC in the future will serve as the national governing body (NGB) for
the scheme, while the independent assessors will take on the role of CBs and will be accredited
to the DSM.

Requirements for independent assessors

MTCC registers and appoints appropriate companies or organisations as independent asses-
sors to carry out assessments for the purpose of forest management as well as chain-of-
custody certification. Companies or organisations wishing to be registered with MTCC as
independent assessors have to comply with MTCC’s terms and conditions for registration. A
team comprising a minimum of three qualified and experienced auditors is required for forest
management certification. Professional foresters with expertise and minimum five years field
experience in forest management, or non-foresters with similar experience in fields related to
forest management such as ecology, environmental sciences, biology, sociology and forest
economics, can qualify as auditors for forest management certification.

For chain-of-custody certification, at least two auditors who have the necessary professional
training, work and audit experience are needed for the assessments. The auditors should also
be familiar with the local wood-based industries as well as with applicable local regulations and
documentation relevant to chain-of-custody certification.

From time to time, auditors for both forest management and chain-of-custody certification
undergo training to update themselves with the assessment procedures and requirements for
certification. The list of registered assessors is posted on MTCC’s website.

Peer review

The peer review process is only necessary for evaluating the assessment report for forest
management certification. Normally, two peer reviewers are involved in one assessment and
they are appointed by MTCC, based on the FMU being assessed. The basic aim of a peer
review process is to obtain a second opinion on the compliance of the FMU concerned with the
requirements of the certification standard.

Interested individuals are required to meet certain criteria for registration as peer reviewer. They
are to have, amongst others, a minimum of five years experience in forestry or expertise related
to various aspects of sustainable forest management such as ecology, environmental sciences,
biology, sociology and forest economics; the necessary training and work experience to assess
the adequacy of the assessment reports; and a good understanding of the certification standard
and its related assessment procedures.

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Assessment of FMUs and requirements for consultation with interested parties

FMUs are assessed by the independent assessors to the requirements of the forest manage-
ment standard (MC&I). The scope of the assessment is on the forest management system and
practices within the PRFs of the FMU. The assessment is conducted to evaluate current docu-
mentation and field practices in forest management and to assess the level of compliance with
the requirements of the standard. This is done through document reviews, communication or
consultation with interested parties, and a field assessment.

The assessment is conducted by a team comprising a lead auditor and two other auditors.
Members of the assessment team are selected based on relevant technical skills to ensure that
the team has the expertise to address the main economic, environmental and social aspects of
the forestry operations in the FMU. All team members must be independent of the client’s busi-
ness interests.

When conducting the assessment, an opening meeting is held with the client’s management
which will brief the assessment team on the forestry activities in the FMU, including on-going
activities covering forest management, development, conservation and harvesting. Based on
the briefing, an itinerary is decided by the assessment team, which must also include time for
consultation with interested parties in the FMU, such as the environmental and social NGOs,
local communities, local and national government officials, forestry departments, academic and
research bodies, workers’ unions and timber trade representatives.

During the visits to various sites within the FMU, the auditors consult the relevant persons who
are involved in the forest management practices, which include the forest managers, forest
workers and contractors, regarding these practices. This is in order to ascertain the level of
understanding of the procedures and management plans, and the level of adherence to the
requirements of the standard. Consultations are also held with persons or groups who may be
affected by the forest management practices, such as local communities living within or near the
vicinity of the forest area that is being assessed.

The main aim of such consultations is to obtain feedback on how forest management practices
are actually implemented in the field, the practical problems encountered and the results of
these practices. During the field assessment, objective evidence is collected to assess the
adequacy of compliance with the forest management standard.

Following completion of the assessment, a closing meeting is convened, primarily to inform the
FMU management of the recommendations of the assessment team regarding the certification
decision, to explain major and minor Corrective Action Requests (CARs) and recommendations,
and to record any explanations or disagreements by the management on the CARs or recom-
mendations made by the assessment team. Major CARs raised during an assessment preclude
the FMU from being certified.

Based on the assessment carried out, an assessment report is prepared by the assessor, which
includes the details of the major and minor CARs raised (if any) and a surveillance plan for the

159
Chain-of-custody certification

five-year period of validity of the certificate. The assessment report is forwarded to the FMU
management and two peer reviewers for comments and feedback.

Chain-of-custody certification

Applicants for chain-of-custody certification are assessed by the independent assessors for
compliance against the requirements as stipulated in the MTCC document entitled Require-
ments and Assessment Procedures for Chain-of-Custody Certification (RAP/COC). Two
auditors are involved in the assessment, one being the lead auditor.

During the assessment, the following activities are carried out by the assessment team:
A review of all pertinent records and reconciliation of the findings, including spot checks of
the product on the ground;
Inspection of the mechanisms for identification of certified wood-based material, its
utilisation, separation between certified and non-certified product; and
Reconciliation of the documented procedures with actual practices.

There are two systems available for an applicant to comply with the chain-of-custody require-
ments; i.e. (i) physical separation system; and (ii) minimum average percentage system.

The minimum average percentage system allows the applicant to mix certified and non-certified
wood in the course of production if specified minimum average percentages of input of certified
wood are met. In this approach, the total batch of products can be labelled as certified when the
amount of certified material in the input batch exceeds the set minimum average threshold.

The minimum percentage for certified material in the different wood-based products would
follow these parameters, and is subject to periodic review:
(a) Collections of Solid Wood Products
The minimum percentage is at least 70% by volume of the wood used in manufacturing of
the product, or the collection of products, for the collection to be certified.
(b) Assembled Products made of Solid Wood Parts
The minimum percentage is at least 70% by volume of the wood used in manufacturing
the product for the product to be certified.
(c) Chip and Fibre Products
The minimum percentage is at least 30% by volume or weight of the new virgin wood chip
or fibre used in the manufacturing the product for the product to be certified.
(d) Assembled Products Containing Both Solid and Chip and Fibre Parts
The minimum percentage must meet the respective thresholds for the components, so
that at least 70% (by volume or weight) of the wood and at least 30% (by volume or
weight) of the virgin chip and fibre must be certified for the combined product to be certi-
fied.

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Issuance of certificates and public information

For forest management certification, the assessment report, together with the FMU manage-
ment’s comments and peer review reports, are submitted for the decision of the Certification
Committee, which is made taking also into consideration the evaluation report prepared by
MTCC.

Similarly, for chain-of-custody certification, the Certification Committee makes the appropriate
certification decision based on the recommendation of the assessor as stated in the assess-
ment report and the applicant’s comments, and also taking into consideration the evaluation
report prepared by MTCC.

Where a decision has been taken by the Certification Committee to issue a certificate, the appli-
cant will be awarded, as appropriate, a Certificate for Forest Management or a Certificate for
Chain-of-Custody, together with the terms and conditions for the issuance of these certificates.
A number is given to each Certificate issued by MTCC. For chain-of-custody, a schedule detail-
ing the scope of certification (i.e. the type of product certified) will be shown in the Certificate.

A Certificate for Forest Management or Certificate for Chain-of-Custody is valid for a period of
five years. Following certification, the continued compliance of the certificate holders with the
relevant certification standards is verified through regular surveillance visits by the independent
assessors. Surveillance visits are conducted once every six to 12 months for forest manage-
ment certification and once every six months for chain-of-custody certification, for the first two
years. Subsequently, the surveillance visits are conducted annually, unless there have been
major CARs identified in the surveillance visits of the second year.

The list of holders of the Certificate for Forest Management and Certificate for Chain-of-Custody
are put on MTCC’s web site. The web site also provides summaries of the assessment reports
of the FMUs which have been awarded the certificate. In addition to ensuring the transparency
of the MTCC scheme, putting such information in the public domain serves to encourage feed-
back from the public regarding the forest management practices of the FMUs concerned, thus
assisting MTCC to monitor the FMUs to ensure continued compliance to the certification
standard.

Labelling and logos

The MTCC logo on a product provides an assurance that the material used originated from
forests which have been certified by MTCC. The logo is copyrighted and owned by MTCC, and
has also been registered as a trademark. The use of the logo has to conform to the rules and
procedures specified in the MTCC Logo Guide for Certificate Holders, which details the terms
and conditions, various permitted on-product and off-product uses, procedures for getting
approval to publish, print or otherwise disseminate material and on reproduction of the logo.

161
Labelling and logos

Only certificate holders are allowed to use the MTCC logo on their products. The use of the
MTCC logo requires the inclusion of the following key elements (Figure 2):
The MTCC logo
The MTCC copyright claim, i.e. ‘© 2000 Malaysian Timber Certification Council’
Certificate for Forest Management or Certificate for Chain-of-Custody number of the
certificate holder
An approved on-product or off-product statement
Mean minimum percentage of MTCC-certified material of the total wood, chip or fibre used
in making the product or in the batch manufacturing process (for products using the
minimum average percentage system)

Figure 2: Key elements to be included on a label bearing the MTCC logo

On-Product
Trademark Symbol Statement

At least 70% of the wood used in making
this product comes from forests
independently certified according to the
rules of the Malaysian Timber Certification
Council

73%
SM Minimum

Certificate for Chain-of-Custody No. 008
© 2000 MALAYSIAN TIMBER CERTIFICATION COUNCIL

Certificate for
Chain-of-Custody No.
MTCC Logo MTCC Copyright Claim

Mean minimum percentage of
MTCC-certified material

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Accreditation

In the present arrangement, MTCC serves as the national certification body (CB) and the
independent assessors are registered with MTCC in compliance with certain terms and condi-
tions. As the CB, MTCC is the authority in charge of issuing the Certificate for Forest Manage-
ment and the Certificate for Chain-of-Custody which bear the MTCC logo.

As mentioned earlier, in future, the independent assessors will take on the role of CBs who will
be responsible for the issuance, suspension and withdrawal of certificates. The CBs will be
accredited to the DSM which is the national accreditation body (AB) and is affiliated to the
International Accreditation Forum (IAF). MTCC will then serve as the national governing body
(NGB) for the scheme, with responsibilities such as issuing of licences for the use of logo by
certificate holders, keeping a register of the on- and off-product logo users, publicising and
promoting the MTCC scheme, and coordination of the development of standards for forest
management and chain-of-custody.

Acceptance and perceptions of the scheme

The phased approach taken by MTCC in implementing its timber certification scheme has
received broad support from most of the local stakeholder groups. This is reflected in the large
number of organisations which have attended and participated actively in the regional and
national-level consultations coordinated by MTCC.

However, a small group of social NGOs have excluded themselves from the standard-setting
process when MTCC indicated that it was not in a position to meet certain „demands” made by
them because some of these „demands” required amendments to the relevant state legislation,
and while the other „demands” could be included in the certification standard, nevertheless the
extent and manner of their inclusion should be the subject of discussions with the other stake-
holder representatives as part of the standard-setting process.

The main reason why these NGOs are opposing the MTCC scheme and timber certification in
general is that they are mainly concerned in protecting the native customary rights of the local
communities. One key requirement for certification is security of tenure over the forests, which is
normally achieved by gazetting the forests as PRFs. The process of gazettement is however
seen by these NGOs as extinguishing the native rights of the local communities over the forests.

The NGOs concerned nevertheless continue to be invited to participate in the various consulta-
tion processes related to timber certification which are coordinated by MTCC.

Based on the broad support given to the MTCC scheme, eight FMUs in Peninsular Malaysia
and one FMU in Sarawak have undergone assessment, following which the eight FMUs in
Peninsular Malaysia have been certified.

The number of applicants for chain-of-custody certification has been steadily increasing since
the operation of the scheme, clearly indicating that more timber companies are wanting to be
certified so as to fulfill the demands from their overseas buyers for certified timber products from

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Information about the scheme

Malaysia, especially from buyers in Europe. However, many other timber product manufacturers
and exporters are still reluctant to apply for chain-of-custody certification as they feel that their
overseas buyers are not willing to pay a higher price for their certified timber products, despite
the extra effort and expenses that they have to put in to achieve certification.

The Danish Ministry of the Environment has given recognition to the MTCC scheme by including
it as one of the accepted certification schemes in its document entitled Purchasing Tropical
Timber - Environmental Guidelines, describing the MTCC certificate as providing a good
guarantee of legal forest management, on its way towards becoming sustainable (DANISH
MINISTRY OF THE ENVIRONMENT 2003).

The report commissioned by the UK Central Point of Expertise on Timber has also concluded
that the certificate issued by MTCC provides the assurance of legally harvested timber (UK
DEPARTMENT FOR ENVIRONMENT, FOOD AND RURAL AFFAIRS 2004).

Current status

By the end of October 2004, eight FMUs in Peninsular Malaysia and one FMU in Sarawak
managed by a privately-owned company covering a total of 4.73 million hectares of PRFs (or
33% of Malaysia’s total PRFs) have been awarded the Certificate for Forest Management. A
total of 55 timber companies have been awarded the Certificate for Chain-of-Custody.

The first shipment of MTCC-certified timber was exported in July 2002 to The Netherlands.
Since then, MTCC-certified timber has been exported to other countries, including Belgium,
Germany, the United Kingdom, France and Australia.

Information about the scheme

Further information about the MTCC timber certification scheme can be obtained by contacting
the following address:

Malaysian Timber Certification Council,
19F, Level 19, Menara PGRM,
No. 8, Jalan Pudu Ulu, Cheras,
56100 Kuala Lumpur, Malaysia.

Tel: 603 9200 5008 Fax: 603 9200 6008
E-mail: mtcc@tm.net.my Website: http://www.mtcc.com.my

Notes
1
The NSC is a multi-stakeholder committee that was formed as a result of the decision made at the
MTCC-FSC Workshop on Forest Certification that was held in December 2000. The NSC was formed
to facilitate the cooperation between MTCC and FSC primarily in the development of the standard for

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MTCC timber certification scheme
Chew Lye Teng / Harnarinder Singh

forest management certification based on the FSC’s Principles and Criteria through regional and
national level consultations amongst all the stakeholders in Malaysia. It should be noted that the NSC
is not part of the governance structure of the MTCC. The MTCC plays the role of the secretariat to the
NSC by facilitating the NSC standard setting process.

References

DANISH MINISTRY OF THE ENVIRONMENT (2003): Purchasing Tropical Timber - Environ-
mental Guidelines. The Danish Environmental Protection Agency and The Danish Forest and
Nature Agency, Copenhagen.

UK DEPARTMENT FOR ENVIRONMENT, FOOD AND RURAL AFFAIRS (2004): Environment
Minister Elliot Morley Announces Move To Ensure Government Sourcing Of Legal And Sustain-
able Timber. News Release ref: 451/04, 9 November 2004, London.

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Nancy Vallejo / Pierre Hauselmann

Demystifying the jungle of competing certification schemes
Nancy Vallejo / Pierre Hauselmann

Introduction

In autumn 1993, a small organization was launched in Toronto, during a somewhat tumultuous
meeting. This was the Forest Stewardship Council (FSC). Nobody at that time knew where this
organization would be 10 years in the future, and probably not many realized the dramatic and
lasting paradigm shift FSC was bringing with its inception. Maybe for the first time, building on
the concepts of sustainable development as expressed in Rio de Janeiro the year before,
representatives from the business sector, social groups and environmental non-governmental
organizations (NGOs) had agreed to develop together a mechanism intended to use market
forces to foster sustainable development.

The story began in the late 80’s, when the campaigns for a tropical timber boycott started to
show their limits, and when the Rainforest Alliance in the USA launched its certification
programme SmartWood. By the early 90’s, it became apparent that the growing number of
unsubstantiated claims of sustainable forest management was shadowing more serious
attempts to identify it, and use it as a market argument. Accreditation, i.e. the recognition by a
recognized authority that a body is competent to carry out certain tasks, appeared to be the
answer to this problem. But at that time, forest management certification seemed to most as a
good, but completely unrealistic idea. Existing accreditation bodies, as they exist in many
countries, did not seem to see a good business case in this new work area and declined to
embark on such a marginal activity. This lack of interest stimulated the creation of this new
body, FSC.

Although the general view was that FSC was doomed to failure in the short term - many interna-
tional conferences were set up to demonstrate that forest certification was not possible while
already several million hectares were being certified under the FSC accreditation - it not only
survived, but grew, and stimulated an important movement towards certification, far beyond the
sole forest domain. To date numerous schemes have been created in very different sectors,
from agriculture, marine and fresh water fisheries, health and safety, labour and workers’ rights,
fair-trade, organic agriculture1, mining, and many others. While some schemes have appeared
before FSC, e.g. the International Federation of Organic Agriculture Movements (IFOAM), which
was founded in 1972, some are the direct outcome of FSC’s growing success, e.g. the Marine
Stewardship Council (MSC). It can be argued that FSC’s high visibility has given an important
impetus to the whole environmental and social certification movement.

FSC’s own success also stimulated resistance, some of which was expressed by the launch of
competing initiatives, often coming from the forestry sector industry itself. Significant resources,
much larger than FSC’s own, were spent, trying to out compete FSC, but without succeeding in
materializing its doom. The reasons why FSC is still here, despite its own weaknesses, its
sometimes chaotic development and the fierce competition it has to face may lie in the advent
of a new global governance order. This is the theme of the first chapter of this article.

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A new governance order

The arrival of new schemes, stimulated by FSC’s success, brought problems of its own, one of
which is a new multiplication - although still limited - of different claims with different credibility to
different actors, a phenomenon FSC itself had been set up to avoid. The resulting segmentation
of the market means that producers must now choose which system to follow if they don’t want
to multiply the cost of compliance and certification. While big companies may cope with this
situation rather easily, it is more problematic for small producers, particularly in the developing
world. The paradox is that some of the systems competing FSC have exactly been set up to
better accommodate the need of small producers, who now have several systems to comply
with. To attempt to clarify the situation and promote harmonization between the certification
systems, a certain number of frameworks for analysing certification schemes has been devel-
oped by different actors. This has yet to bear results and what some have called the logo war is
still going on. This is the subject of the second chapter of this article.

Other sectors, for example organic agriculture and coffee also face the problem of different
schemes and approaches to certification. However, the antagonism that has developed in the
forestry area does not seem to be reaching the same levels in other sectors. The third chapter
takes the example of coffee and reviews some of the mechanisms used to manage cohabita-
tion.

The final chapter brings together the discussion of the former ones and wonders if there is at all
a jungle of certification systems. It also comes to the conclusion that competition is natural, it is
here to stay and maybe the best driver for overall improvement of the forest certification move-
ment.

Throughout this article, the words certification schemes, certification systems and certification
programmes are used. While they indeed introduce some technical distinctions in terms of
scope, the differences are small enough not to change the meaning of this paper and thus, the
words are used synonymously.

A new governance order

FSC has not only demonstrated resilience against difficulties and adversity, and stayed alive as
an organization; it is continuously growing and improving and its success has stimulated the
emergence of several fiercely competing schemes. This has anchored forest certification as a
phenomenon that is here to stay. FSC being a small and chronically under funded organization,
this situation cannot be related to its intrinsic strength. Reasons must be sought elsewhere.

One of the explanations may lie within the forces that drive globalization and the implication it
has on global governance.

Governance is defined as: „the sum of the many ways individuals and institutions, public and
private, manage their common affairs. It is a continuing process through which conflicting or
diverse interests may be accommodated and cooperative action may be taken. It includes
formal institutions and regimes empowered to enforce compliance, as well as informal arrange-
ments that people and institutions either have agreed to or perceive to be in their interest”

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(Commission on Global Governance 1995: 2 cited in BURGER / MAYER 2003. 50). This entails
two key components for the legitimacy of a governance system:
the acceptance by the public and private organizations of a framework within which to
manage their business
a process of negotiation and power balancing (VALLEJO / HAUSELMANN 2004)

In a public system, governance is state centered, i.e. the state has the power. But this power
can be shared with others (CASHORE 2002). Globalization has induced such a shift of power.

FRANKEL (2003) explains that the establishment of the European Economic Community (EEC)
in 1958 was intended to boost trade between the participating countries. Governments were
ready to drop tariffs to help this to happen. Dropping tariffs was diminishing a direct source of
revenue for the states, but by helping multilateral trade to happen more easily, it was estimated
that the loss would be more than compensated for by the increase of trade and associated
wealth. Dropping tariffs has no impact on national sovereignty and the measure was not
changing the governance order. However it soon became apparent that non-tariff barriers are
possibly more of a hindrance to trade than tariffs themselves. Amongst these, technical regula-
tions come first. Different regulations in different states oblige manufacturers to adapt their
products and production methods to each market. As dropping tariffs was not succeeding in
creating the desired common market, it was necessary to harmonize regulations. But the need
to harmonize regulations to help trade flow between the countries meant that the sovereign right
of states to decide their own laws was questioned, at least for technical matters. Harmonization
took place through the New Approach Directive (EEC 1985). This Directive instructed govern-
ments to refer to standards developed by the European Committee for Standardization (CEN,
Comité Européen de Normalisation) in their technical regulations instead of setting the norms
themselves. This was in practice a devolution of power from governments to a private, supra
national standardization body and the introduction of a new paradigm in terms of governance.
The technical capacity of experts, and the balance of interests in the development of standards
became an acceptable substitute for an elected government and its administration, a new
governance order.

At the global level, the problems and solutions are similar. To avoid unnecessary barriers to
trade the World Trade Organization (WTO), through the Agreement on Technical Barriers to
Trade (TBT), requires governments to refer to international standards. The Agreement does not
specify any standardization organization, but instead refers to some general principles that
international standard setting bodies should follow. Among these are the need to be open to
representatives2 of at least all WTO members, and decision-making mechanisms based on
consensus. The assumed participation of experts representing different economic, public and
geographical interests on an equal basis was supposed to create standards acceptable by all,
thus not creating unnecessary barriers to trade. Analyzing the extent to which this process
works according to expectations is outside the scope of this paper. Suffice to mention that
questions are frequently raised concerning the real equality of participation of the different inter-
ests in international standardization bodies, including by the TBT Agreement itself at each of its
triennial reviews. Other trade limiting factors beyond standardization have also become

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A new governance order

apparent, notably the mechanism for assessing conformity with the standards and the recogni-
tion in different parts of the world of the results of these conformity assessments.

Besides the limitations of the system, this request put on most governments on Earth to rely on
international standards when developing regulations has de facto meant that international
standardization has become a new governance order. The development of, and reference to
international standards for forest certification by certification systems is part of this new govern-
ance order.

While this shift of power from government to private standardization bodies was intentional for
the sake of better performing markets, another shift has occurred that was maybe less foreseen.
This is the governance based on the legitimacy created by multi-stakeholder processes.

CASHORE (2002: 505) identifies two kinds of authority, depending on the source of the policy
making. One is the traditional state centered given authority already mentioned, the other the
private governance systems, which do not get their authority from the state but from the market .
He further postulates that „the viability of any NSMD [Non-State Market Driven] governance
system will be largely determined by whether it can achieve ’legitimacy’ to operate in the
domestic and international spheres”. SUCHMANN (1995 cited in CASHORE 2002) understands
legitimacy as „a generalized perception or assumption that the actions of an entity are
desirable…” This perception is driven by the different stakeholders participating in such a
governance process. Because, as demonstrated in an Edelman Public Relations Worldwide
research (STRATEGYONE 2000), „Non-Governmental Organizations such as Greenpeace and
Amnesty International have become the new ‘super brands’ in global governance, they have
earned a far greater level of trust than some of the most well-respected global multinational
companies such as Ford, Microsoft, G-7 [group of the seven major industrial countries] govern-
ments and global media.” This makes NGOs a central stakeholder group in NSMD governance.

To different extents and with support from different stakeholder groups, all forest certification
schemes operate within these new macro policy trends of NSMD governance and standardi-
zation. While different certification bodies or schemes may disappear in the short term due to
external reasons (e.g. economic considerations), the two big certification families, the Forest
Stewardship Council and the Programme for the Endorsement of Forest Certification schemes
(PEFC) will most probably remain active in the medium to long term.

The need(s) for harmonization

While it is debatable whether a real proliferation of forest certification systems is occurring, there
are clearly two big families. On the one hand, the FSC, with 34 national initiatives globally,
brings together under its accreditation system 14 certification bodies operating worldwide under
a similar set of basic requirements (the accreditation requirements). On the other hand the
PEFC groups 27 national schemes, operating in these 27 countries.

The existence of these two families creates a burden for timber product manufacturers and
retailers, but principally and mostly to producers. Access to a growing number of markets is
facilitated by certification, but adapting the management to certification requirements and the

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certification itself can be costly. Responding to the requirements of two certification systems
significantly increases costs, but choosing one over the other diminishes market access oppor-
tunities. To draw a parallel with what is happening in the organic agriculture sector, a recent
study by the United Nations Conference on Trade and Development (UNCTAD) demonstrates
that in many situations, the price premium gained by selling ‘organic’ is eaten by the necessity
to fulfil different sets of criteria and undergoing different certification exercises to access either
the European, the Japanese or the United States (US) markets (WYNEN 2003).

Big companies can afford several certifications. In fact, often they get engaged with several
processes, in addition to non-forest related ones. Examples include quality and environmental
management systems, social accountability, etc. The issue becomes crucial for smaller organi-
zations. It can even become a trade barrier keeping the most disfavoured actors (e.g. Small and
Medium Enterprises (SME) in developing nations) outside the market of certified goods. There
is thus a strong rationale for trying to harmonize requirements and procedures as much as
possible.

These rather objective arguments in favour of harmonization have, however, been overshad-
owed by many competition related and even emotional elements. One such element is the fact
that NGOs in their majority support the FSC system, which they consider a better tool to
promote their objectives than the PEFC family. Here is not the place to identify whether they are
right or not, but the simple fact that they have this perception creates a higher legitimacy in the
eyes of the public at large for FSC than for PEFC. To a large extent, FSC is thus dependent on
the support of NGOs and may hesitate to enter into negotiations that could be interpreted by
them as watering down the system. The impact of this NGO support, and a further demonstra-
tion that they are a key stakeholder can be seen on the shelves: while more hectares have been
certified within the PEFC system than within FSC’s, the logo of the latter is almost the only one
that is seen in shops.

Important efforts have been made by PEFC and its supporters to minimize the perceived differ-
ences between the two approaches, trying to push forward talks of mutual recognition between
FSC and PEFC. As examples of these efforts, between June 2000 and April 2001, different
institutions convened no less than four international meetings. Two similar frameworks for
facilitating mutual recognition were developed, the Comparative Matrix of Forest Certification
Schemes by the Confederation of European Paper Industries (CEPI 2001), and the International
Mutual Recognition Framework by the International Forest Industries Roundtable (IFIR 2001).
These attempts have not succeeded in bringing about mutual recognition or even harmonization
of some components, but have demonstrated that the cleavage was profound between the
supporters of each system. The difficulty to narrow positions has stalled the series of interna-
tional meetings, an approach that has later evolved into The Forest Dialogue (TFD). The TFD
agenda is broader than certification alone, although many of its efforts still focus on it.

Different groups have published numerous documents besides the two mentioned above, trying
to help understanding similarities and differences between the different certification schemes
and systems (e.g. KANOWSKI et al. 2000, MERIDIAN INSTITUTE 2001, NUSSBAUM et al.
2002, WORLD BANK / WORLD WIDE FUND FOR NATURE (WWF) ALLIANCE 2003,
METAFORE 2004, OZINGA 2004). These different documents have different audiences in

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The need(s) for harmonization

mind. For example, the WORLD BANK / WWF ALLIANCE's Questionnaire for Assessing the
Comprehensiveness of Forest Certification Schemes/Systems (QACC) is for internal purposes
and METAFORE's Matching Business Values with Forest Certification Systems is aimed at
helping business buyers to purchase timber products responsibly. Notwithstanding these differ-
ent audiences, one commonality unites them all: they can be (and are) fiercely criticized by
groups from where they have not originated. Two examples show this situation:
at the time of publication of the IFIR framework (2001), a joint WWF - Greenpeace press
release was titled „Environmental NGOs call for credible forest certification and reject IFIR
mutual recognition proposal” (WWF / GREENPEACE 2001)
when the World Bank / WWF Alliance launched a test of their QACC, PEFC issued a
statement called „World Bank - WWF questionnaire hopelessly flawed - new approach
offered by PEFC” (PEFC 2004a)

Antagonism remains and does not seem to diminish. It is questionable whether insisting on
minimizing the perception of differences or working towards mutual recognition will ever
succeed in reducing it.

Probably the first occurrence of the need to recognize differences as well as similarities
between schemes was reflected in one of the outcomes of a meeting jointly organized in Rome
in February 2001 by the Food and Agriculture Organization of the United Nations (FAO), the
Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ, German Agency for Technical
Co-operation), and the International Tropical Timber Organization (ITTO) (FAO / GTZ / ITTO
2001). The following year, NUSSBAUM et al. (2002) published a practical guide for assessing
certification schemes where they insisted that organizations wanting to use this guide start by
defining their objectives or expectations regarding certification. Indeed expectations, and thus
the elements of a certification scheme, may be different depending whether you are, for
example, a public authority or a retailer revising your procurement policies or an activist NGO
hoping to bring radical changes in forest management. The WORLD BANK / WWF Alliance’s
QACC (2003) is putting this recommendation into practice. Its aim is to inform the Alliance on
the comprehensiveness of different schemes, in relation with its own objectives. This could be
interpreted as a de facto recognition that what is sufficient for the Alliance may not be for others,
or vice versa.

The World Business Council for Sustainable Development (WBCSD) proposed a slightly differ-
ent approach, the Legitimacy Thresholds Model (LTM) (GRIFFITHS 2003). This model is
intended to „address the pressing issue of certification system proliferation, interaction and
conflict.” While the approaches described above suggest that each organization defines for itself
what is legitimate in terms of certification, the LTM proposes a multi-stakeholder process to
define broad categories of legitimacy, negotiated between the concerned parties. As examples,
the model indicates three legitimacy thresholds:
a high level to be achieved in order to be „considered credible by defined stakeholder
groups, such as customers for procurements”

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a medium level which could involve a limited number of forest management attributes as
compared with the high level, and which could be considered legitimate for small owners in
developing countries
a low level, or minimum threshold, for example legally sourced wood

For the system to be operational, certain elements should be in place, including an accepted
process to reach agreement on the thresholds and the mechanism to measure them and an
agreed rating agency to assess periodically the different schemes.

The Forest Dialogue (TFD), „a group of individuals from diverse interests and regions that are
committed to the conservation and sustainable use of forests” (TFD 2004a), which was estab-
lished in 1999, has taken on the WBCSD concept and will „continue discussion on the LTM
concept” (TFD 2004b) at its next meeting, held mid-October 2004. To help the discussion, TFD
has commissioned a paper „contrasting four approaches to certification system assessment”
(WORLD BANK / WWF Alliance QACC, CEPI Matrix, IFIR framework, FERN report [OZINGA
2004]).”

The Legitimacy Thresholds Model makes one very helpful proposition: that a framework for
assessing the different schemes / systems be agreed by the different stakeholders, thus
proposing that a common measurement system (common metrics) should be applied by all. It
furthermore reiterates that different organizations may have different legitimacy requirements.
However, the proposition may encounter problems for, inter alia, the following reasons:
By proposing that broad legitimacy thresholds are accepted through a negotiation process
between the different stakeholders, it may simply divide the discussion - and its lack of
resolution - that took place on mutual recognition into different parts, as expressed by the
high, medium and low categories.
To allow the thresholds to be commonly agreed will mean that all elements that are
important to each organization need to be included in the assessment framework, but also
that none that one organization does not want is incorporated. Considering the history of
past negotiations, this is a feat that may prove difficult to achieve. The pressure would not
exist, or at least would be much less if the thresholds were left to individual organizations to
decide for themselves. The following fictive example may help to clarify this thinking.
Imagine the case of genetically modified (GM) trees, a subject that is well known to raise
passions. Opponents will probably insist that requirements related to GM tree limitation are
incorporated in the assessment framework, and will insist also during the negotiation that all
thresholds include some requirement on this topic. GM trees proponents may not care
whether there are such conditions in the assessment framework, as long as they have the
option to decide that this specific aspect does not enter into their own legitimacy threshold.
This could easily be accommodated) if the thresholds are individually set. But this will be
significantly more difficult to achieve if the thresholds are negotiated with the GM trees
opponents. The interest of GM trees proponents will thus be that no reference is made to
GM trees in the assessment framework, something that could probably not be acceptable to
opponents.

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The need(s) for harmonization

Trying to get an agreement on both the metrics and the thresholds for broad categories may
thus create a situation where the commonly accepted threshold will not be easier to reach than
mutual recognition itself, but furthermore may jeopardize the chances of succeeding in
developing a common set of metrics that everyone could accept. Only reaching an agreement
on the latter would be a giant step ahead.

One further intriguing aspect is the need to now develop analytical papers to analyze prior
analytical works on forest certification. Referring again to the history of forest certification, firstly,
there were numerous unverified claims. The Forest Stewardship Council was created to harmo-
nize and identify sufficient quality (or legitimacy). Then other schemes or systems entered into
play, which has created a new area of disagreement and confusion. Firstly one, then other
analytical frameworks have been developed to show similarities and differences between
schemes. However, while the number of such frameworks grew, so did confusion and antago-
nism. We are now witnessing the arrival of a new generation: the analytical frameworks to
analyze analytical frameworks. Will this be the end of the spiral? Or just the beginning of
another round in a series of papers that will be accepted only by those who can see their own
perceptions reflected in these papers?

Other sectors, similar problems

It is often heard that there is a proliferation of certification schemes and systems for forest
management. As mentioned above, most if not all fit into two families, from which a producer
has to choose:
The Forest Stewardship Council (FSC), with 37 National Initiatives, 14 accredited certifi-
cation bodies, operating worldwide (currently forest management certificates have been
awarded in 61 countries (FSC 2004a, 2004b). Several programmes for helping producers to
achieve management operation certifiable under the FSC system, such as the Tropical
Forest Trust can be included in this family.
The Programme for Endorsing Forest Certification schemes (PEFC), which has currently 27
members with certificates in 13 European countries (PEFC 2004b). Several non-European
members are in the process of being endorsed by PEFC, which will increase the number of
countries that have PEFC certificates to, at the maximum, the number of members.

A possible third family is not considered here, the Environmental Management System (EMS)
certification, either under the European Eco-Management and Audit Scheme (EMAS) or ISO
14001, because they are not specific to forestry.

Responsible management certification exists in other fields than forest. It is for example well
developed in the agriculture domain and a cross fertilization and learning process may help all
to improve. The situation of a forest producer is compared below with the one with which a
coffee producer is confronted.

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Certification in the coffee sector can be:
Organic: The organic certification market is broadly divided into regulations in the EU, USA
and Japan, all different and requiring different inspections, but unavoidable to enter the
respective markets under the denomination ‘organic’ and IFOAM (International Federation
of Organic Agriculture Movements), which has the favour of civil society and is, by
extension, well appreciated by certain retailers.
Rainforest Alliance Sustainable Agriculture certification, which takes a more holistic
approach and tries to balance environmental, social and economic elements. Certain
important multi-national roasters demand this certification.
EurepGap3 / Utz Kapeh4: This certification system has been developed by all the main
retail chains in Europe, and is de facto a necessity to reach their market. The EurepGap
focuses on food safety and agricultural methods ensuring good and safe agricultural
products.
FairTrade: Fairtrade certification provides an important price premium for mainly small
producers if they comply with a set of principally social requirements - it is the only system
that incorporates fixed prices in its standards. However, although FairTrade markets have
had for several consecutive years a two digit annual growth rate, the demand is limited, and
typically certified producers can only sell a small part of their certified production under the
FairTrade regime.
Starbucks: As a coffee roaster the North American company has the particularity to sell its
coffee to end consumers as a drink, with a high added value compared to green coffee.
This allows it to buy at higher prices than market, provided producers comply with a set of
specific environmental and social requirements that fit into the corporate social and
environmental policy of the company.
The Common Code for the Coffee Community (CCCC): Developed initially through a
collaboration between GTZ and the German Coffee Association, the CCCC is well
supported by all the international traders and roasters. This could be seen as an answer
from the latter to the control by retailers through the EurepGap system. The CCCC is still in
its development phase.

The list above is not exhaustive, but mentions initiatives that may have most impact on trade.
Many others relate to shade grown coffee. As can be seen, a coffee grower needs to decide
between at least nine major initiatives which one(s) will bring him most benefits, as he will
probably not be able to afford to comply with and be verified against them all.

The CCCC initiative, as its name suggests, proposes a common baseline for all other
approaches, upon which they could build. One expected benefit would be that once imple-
mented and verified, this baseline would not need a different management system nor to be
controlled again to access other possibly more demanding certification, thus avoiding costly
duplication. Since the implementation phase of the CCCC initiative has not started yet, whether
it will be successful or simply add another verification system on coffee producers remains to be
seen. While an analysis of the strengths and weaknesses of the initiative falls outside the scope
of this article, there are several elements that make this project relevant to this discussion:

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Other sectors, similar problems

it is about harmonization
several other and potential competitor schemes, including from the NGO side5, participate
in the elaboration of the initiative
several campaigning social and environmental NGOs are part of the process6 (CCCC
2004a)

The CCCC initiative has succeeded, at least for the time being, in bringing together the majority
of the coffee trade and industry, some big and small producers, different competing certification
schemes, and NGOs to discuss and develop a commonly acceptable mainstream verification
scheme (CCCC 2004b). This has never been achieved in the forest certification debate. It is
thus interesting to try to identify the key elements that have allowed this to happen.
The ‘coffee crisis’ which has seen coffee prices plummet in recent years, thus destabilising
the revenue of millions of farmers has created a sense of urgency to act amongst most
actors. This background is not transferable to the forest sector where even if low, prices are
more stable.
The presence of the most important actors in the coffee trade and industry, representing
together the vast majority of the world coffee trade7, clearly sends the signal that this
initiative cannot be ignored by anyone involved in the coffee sector. This situation may not
be easily transferable to the forest sector, which is more fragmented than the food sector.
The 4Cs initiative was developed as a ‘mainstream’ approach. As such it does not try to
supplant other initiatives, only to provide a common ground. It is thus an opportunity to
streamline the different verification and certification systems and could favour the overall
success of these approaches. It places itself outside the competitive ground of certification.
It was developed from the onset as a business-to-business (B2B) declaration scheme, with
no on-product labelling (CCCC 2004c), thus placing itself outside the competitive ground of
product labels. This last point may be the most important one.

These are in our view the four primordial elements that have allowed the CCCC discussion to
happen in a reasonably non-conflictive way. On these, the two that may be applicable to the
forest certification debate relate to competition. By respecting the niches8 of the other certifi-
cation schemes, the CCCC initiative has been able to bring the different groups together and
avoid a ‘logo war’ where all camp on their position. Could this be transferred to the forest
sector?

Recognizing differences

The need to recognize differences between the different forest certification systems has, as
mentioned above, been recognized for some time. What the example of the coffee sector tells,
is that this differentiation may need to go further than the set of requirements on forest manag-
ers and the certification methodologies. It should be extended to the recognition that the clients9
of the different systems may not be the same. If clients are not the same, the messages and
their supports (e.g. on-product logo) may need to be different.

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Nancy Vallejo / Pierre Hauselmann

The steps taken by TFD and the Legitimacy Thresholds Model described above could be initial
steps in this direction, with the caveat already mentioned. Admitting that different legitimacy
thresholds can co-exist, is actually recognizing that there are different needs expressed by
‘certification consumers’ And there are as many market niches as there are needs.

It is remarkable that the two forest certification families, FSC and PEFC have different sets of
supporters. Very broadly speaking FSC is supported by NGOs and PEFC by the timber produc-
ers. Of course this is a generalization and there are some NGOs supporting individual schemes
in the PEFC family and producers in favour of FSC. But it is also remarkable that this fact does
not keep the two systems from aiming at the same market segment with similar claims and want
to be the one size that fits all. It might be worth investigating if this is not a wrong judgement on
the part of the schemes themselves. Could the fact that PEFC seems to be the preferred
system at the lower end of the distribution chain (supported by producers) mean that its main
clients are processing companies, thus making PEFC a perfect candidate for B2B communica-
tion? Could the fact that FSC is apparently preferred towards the upper end of the distribution
chain (supported by NGOs whose leverage lies with consumers) mean that it is best suited for
being used as an on-product communication mechanism?

Certification systems should maybe sit together, without being under the pressure of the many
external parties trying to influence them, and try to identify if their respective clientele is differ-
ent. If that was the case, maybe their main business falls into different segments of the market.
Maybe after all, FSC and PEFC need not be as much in competition as they are? By identifying
and focusing on their own comparative advantages, each would probably end up better off.
Finally, disengaging from a fierce competition might help the two systems to identify without
passion if and where they have complementarity and find mechanisms such as bridging
documents10 to simplify access to the two certifications. But this could only happen if clear
niches have been identified and agreed upon.

In this respect, it is worth noting that it is a recognized business strategy by certification bodies
to provide more than one certificate with one audit. This is happening in other domains, for
example with ISO 9000 and ISO 14001 certification and this trend starts to appear in the forest
sector: some certification bodies offer both FSC and PEFC11 certification. The question for
certification systems is whether they want to have some control over the process or whether
they will let it happen organically, through market forces, but maybe in a less harmonized and
structured way.

Of course, it may also turn out that a similar message, for similar audiences needs to be
provided by both systems. As recognized by the World Trade Organization in its third triennial
review of the Technical Barriers to Trade Agreement, on the topic of harmonization and mutual
recognition agreements (MRA), there are many reasons why collaboration, not to speak of MRA
can be difficult to achieve, including the lack of
„tangible economic benefits,
interest of stakeholders,
support from key players;

177
Recognizing differences

underlying compatibility in the regulatory systems of the potential MRA parties; and
sufficient resources for MRA negotiation and implementation” (WTO 2003: § 39).

But the very exercise of identifying the respective niches through a collaborative approach may
help at least to put some order in the rules of the competition game.

Demystifying the jungle

As a conclusion, this chapter reviews what can constitute the ‘myth’ of the jungle. Is there a
jungle at all?

The word ‘proliferation’ is frequently appended to ‘forest certification system’. This to such an
extent that most often, the question whether this proliferation is a reality is not raised anymore.
As indicated above, most, if not all certification schemes belong either to the PEFC or the FSC
families. Within PEFC, the connection between schemes is done through mutual recognition of
participating schemes, while in the FSC system the link is established through an accreditation
programme, supposing mutual recognition between the accredited bodies. This situation, at
least compared with the complexity encountered in the coffee world, seems rather straightfor-
ward. It is indeed arguable that two is too small a number to either call it ‘proliferation’ or seeing
this as the typical diversity of the jungle. In this perspective, the myth is the existence of the
jungle itself.

However, positions are so polarized between the supporters of the two systems, as demon-
strated by the press releases mentioned above, that it is difficult to have a neutral stance in the
debate and any observer is quickly labelled as pertaining to one camp or the other. The compe-
tition between the two systems is fierce, and the rules of the game ill defined. In this perspec-
tive, yes, it can be argued that the law of the jungle is currently ruling the relation between the
two camps. There is some likelihood that this ‘jungle’ would appear more as a gentle grass field
if the two camps could examine where competition occurs and where it does not and build on
this to identify complementarities and specificities.

If the different actors could take a step back and try to analyze the customer base of each certi-
fication system, probably enough differences would be spotted to allow the identification of the
specific niche of each system. This is not to say that the niches would not overlap at all, but it is
imaginable that a significant part would not fall into the competitive domain. Sending a clear
message about this would be most beneficial for the producers who would have on the one
hand a better understanding of the services provided by each system, and on the other hand
could tap into this complementarity to avoid the duplication of certification procedures - and
costs.

Although it is questionable whether there is a jungle of forest certification systems, the argument
so far is that fierce and not always fair competition12 is creating the perception of a jungle. Thus,
removing competition would remove the jungle. Is it feasible? And is it desirable?

Completely removing competition between PEFC and FSC is not likely to ever happen. Even if
they were to agree, as suggested above that the former should focus on B2B and the latter on

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consumer oriented claims, they would still need to position themselves as better covering the
need of both the organizations looking for certification and the people to whom the claim is
addressed. Both will need to convince forest producers to get certified, and consumers that their
system is legitimate for what it wants to achieve. If only for this reason, a certain level of compe-
tition will always exist between the two systems. What this article suggests, however, is to try to
identify:
where competition does not need to occur
where it needs to happen
ultimately maybe fairer rules of the game

Reduced at its simplest expression, certification is only a tool to credibly communicate a
message. But if certification is a tool, there is no evident reason why this tool should not be
submitted to the same pressures as other tools or products. If a company develops a good
product, quickly others will imitate this product, building on the image of the original and trying to
incorporate in theirs only what improvement or modification is needed to differentiate it from the
original and attract customers. The original product will soon need to adapt to maintain its edge
and/or create a new one. This process is probably one of the most powerful engines behind
improvements and better service to customers and consumers. This is exactly what competition
is about, this is what it does to forest certification as to any other product or service and it has
already engaged both systems in significant overhauls. PEFC revised its entire structure
between November 2002 and October 2003, answering some of the concerns of its critics and
FSC just adopted a completely new approach to the use of its logo, making it easier to apply for
companies (FSC 2004c).

Could it be that what is needed is a saner competitive environment, not to insulate the systems
from competition and its driver towards continuous improvement?

Demystifying the jungle of forest certification systems turns out to address several myths:
the myth of proliferation. There are only two certification families
the myth that the existence of different systems is overall detrimental
the myth that the systems need, as they currently do, to send about the same message, to
the same audiences and using the same supports (e.g. on-product claims)

Resolving this last point may be the key to a more harmonious, if not harmonized co-existence
between the certification system families.

179
Notes

Notes
1
The International Federation of Organic Agriculture Movements (IFOAM) was founded in 1972, thus
long preceeding FSC, but it can be argued that its success is relatively recent and has been stimu-
lated, at least partially, by FSC’s own visibility.
2
Representatives need not be government delegates but can be experts from the said countries.
3
Euro-Retailer Produce Working Group (EUREP) and Good Agricultural practices (GAP)
4
Both schemes have recently entered into a mutual recognition agreement and can thus be considered
as one.
5
Utz Kapeh and Rainforest Alliance
6
Oxfam, the FoodFirst Informations- und Aktionsnetzwerk (FIAN). Greenpeace accompanied the proc-
ess until shortly before the launch of the draft 4C code in September 2004. An issue over genetically
modified organisms (GMOs) made that they withdrew from the process (GREENPEACE 2004).
7
Including Kraft, Nestlé, Neumann, Sarah Lee, Tchibo, Volcafé.
8
To be understood as the ‘biological’ niche - the specific scope of each, and not in terms of small
market size.
9
In the sense of the people to whom the certification claim is addressed.
10
A document that identifies commonalities and additions, allowing for example that certification under
one system can be recognized by the other as fulfilling at least some of its own requirements.
11
To be understood in a broad sense, for example including the US Sustainable Forestry Initiative (SFI),
which is a PEFC member.
12
Acts of competition may not come from the certification system themselves, but also from their
supporters.

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Nancy Vallejo / Pierre Hauselmann

References

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Social and Ecological standards. GTZ Programme Office for Social and Ecological Standards,
Eschborn.

CASHORE, B. (2002): Legitimacy and Privatisation of Environmental Governance : How Non-
State Market-Driven (NSMD) Governance Systems Gain Rule-Making Authority in Governance.
in: International Journal of Policy, Administration and Institutions, 15 (4), Blackwell, Malden,
Oxford.

CCCC (2004a): Steering Committee. Common Code for the Coffee Community
http://www.sustainable-coffee.net/download/cccc-steering-committee.pdf.

CCCC (2004b): Sustainability in coffee growing, processing and in trading of raw coffee.
Common Code for the Coffee Community http://www.sustainable-coffee.net/project/index.html.

CCCC (2004c): Common Code for the Coffee Community. 9 September 2004 version, Common
Code for the Coffee Community http://www.sustainable-coffee.net/download/4c-drafts/common-
code-en.pdf.

CEPI (2001): Comparative Matrix of Forest Certification Schemes. Confederation of European
Paper Industries, Brussels.

EEC (1985): Council Resolution of 7 May 1985 on a New Approach to technical harmonization
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Schemes and their Supporters'. 19th and 20th February 2001, Rome

FRANKEL, C. (2003): Standardization: policy transformed. Presentation made at the „Green
wishes to Standardization” conference October 23rd, 2003, Copenhagen.

FSC (2004a): FSC Certified Forests list October 2004. Forest Stewardship Council, Bonn
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tified_Forest.pdf

FSC (2004b): FSC accredited National Initiatives (October 2004). Forest Stewardship Council,
Bonn.

http://www.fsc.org/keepout/content_areas/77/77/files/5_1_2_2004_10_21_FSC_National_Initiatives.pdf

FSC (2004c): FSC on Product Labelling requirements. FSC-STD-40-201, Forest Stewardship
Council, Bonn.

GREENPEACE (2004): Greenpeace steigt aus Kaffee Kodex aus. News zu Gentechnik,
10.9.2004

http://www.greenpeace.org/deutschland/?page=/deutschland/news/gentechnik/greenpeace-
steigt-aus-kaffee-kodex-aus.

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GRIFFITHS, J. (2003): Forest certification systems and the „Legitimacy” Thresholds Model
(LTM): World Business Council for Sustainable Development, Geneva.

IFIR (2001): Proposing an International Mutual Recognition Framework. International Forest
Industries Roundtable.

KANOWSKI, P. / SINCLAIR, D. / FREEMAN, B. / BASS, S. (2000): Critical elements for the
assessment of schemes: Establishing comparability and equivalence amongst forest manage-
ment certification schemes. Agriculture, Fisheries and Forestry - Australia, Canberra.

MERIDIAN INSTITUTE (2001): Comparative Analysis of the Forest Stewardship Council and
Sustainable Forestry Initiative Certification Programs. Washington DC.

METAFORE (2004): Matching Business Values with Forest Certification Systems, Portland.

NUSSBAUM, R. / JENNINGS, S. / GARFORTH, M. (2002): Assessing forest certification
schemes: a practical guide. ProForest, Oxford.

OZINGA, S. (2004): Footprints in the forest. FERN, Brussels.

PEFC (2004a): World Bank - WWF questionnaire hopelessly flawed - new approach offered by
PEFC. Programme for the Endorsement of Forest Certification schemes, Luxemburg
www.pefc.org/internet/html/news/4_1154_64/5_1105_1052.htm

PEFC (2004b): Statistic figures on PEFC certification. Programme for the Endorsement of
Forest Certification Schemes, Luxemburg http://www.pefc.cz/register/statistics.asp 31/8/04.

STRATEGYYONE. (2000): Non-Government Organizations More Trusted than the Media,
most-Respected Corporations or Government, Edelman PR Worldwide, Chicago,

TFD (2004a): About TFD. http://research.yale.edu/gisf/tfd/index.html

TFD (2004b): Moving forest certification forward - creating market conditions for informed
choice that accommodates system diversity: 2nd International Stakeholder Dialogue on Forest
Certification.

VALLEJO, N. / HAUSELMANN, P. (2004): Governance and Multi-stakeholder Processes.
Institute for Sustainable Development, Winnipeg.

WORLD BANK / WWF ALLIANCE (2003): Questionnaire for Assessing the Comprehensive-
ness of Certification Schemes / Systems, Washington DC.

WTO (2003): Third Triennial Review of the Operation and Implementation of the Agreement on
Technical Barriers to Trade, WTO, Geneva.

WWF / GREENPEACE (2001): Environmental NGOs call for credible forest certification and
reject IFIR mutual recognition proposal, 19 February 2001.

http://sfcw.org/mutualrecognition/environmental_ngos_call_for_cred.htm

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WYNEN, E. (2003): Impact of organic guarantee systems on production and trade of organic
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Geneva.

183
Forest certification: driving force
for sustainable development or
counter-productive?
Forest certification as a political regulation concept
Nina Bressel / Klaus Dieter Wolf

Forest certification as a political regulation concept in the context of
global governance
Nina Bressel / Klaus Dieter Wolf

Introduction: political regulation in transformation

„Statehood in transformation” is undoubtedly one of the issues currently posing the greatest
challenge for political science. This is because it involves the loss of importance of traditional
government in its hierarchically regulatory form, which requires no more and no less than a
redefinition of the role of the state - that is generally seen as the classic subject of study for
political science. The possible loss of importance of legally binding state regulation is the result
of the social state’s (self-imposed) overburdening itself with more and more regulatory
responsibilities in the face of problems which are no longer limited to national boundaries, and
which neither the individual state nor the community of states has the resources to tackle
successfully. The traditional regulator - the nation state, which is still as far as ever from
evolving into a global state - is almost or entirely unable to keep up with the denationalisation of
the entities to be regulated. A particular form of state collapse outside the world of OECD
(Organization for Economic Co-operation and Development) is occurring increasingly where
there is little left that can be described as statehood („failed states”), and institutional
deficiencies make effective setting and enforcement of rules impossible. This gives rise to
regulatory gaps which can no longer be filled in a conventional way.

States have tried various strategies for countering this reduced ability to solve problems.
Domestically, the attempt has been made to make good at least part of the loss of direct ability
to act through the corporatist integration of social organisations, e.g. institutionalised participa-
tion by major associations in formulating and implementing state policy, as a way of accessing
previously untapped resources for problem solving1. This itself led to a change in the role of the
state compared with the pluralistic ideal of acting as an intermediary between interests, with the
various social lobbies competing to influence state policy. The state was no longer a neutral
political instance above the social groups, implementing the results of the pluralist process of
social decision making, but instead invited these groups to join in a new concept of the state as
an activating, negotiating and cooperating entity. The result of this change in roles was to free
the relationships between state and society from hierarchies.

At the international level the strategy was to pool limited national resources for problem solving
in order to recover regulatory competence at a collective level. A number of international
regimes reflect these efforts in international governance. However, both these strategies have
had only limited success, leading to the emergence of global governance as a concept combin-
ing the elements of international cooperation and involving civil society and private sector actors
in the regulatory process, giving access to problem solving resources only available to these
groups. The resulting forms of partnership under multi-stakeholder initiatives or networking
transcend both the pluralist and corporatist models of political interaction between the public
and private sectors.

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Introduction: political regulation in transformation

Table 1: Various organisational forms of political regulation

Organisational form pluralist corporatist partnership
Nature of decision-making, different social institutionalised various forms of
relationship of the state with lobbies compete to („incorporated”) horizontal networked
business and civil society influence state policy participation by major cooperation in
associations in dialogue
consensual formulation
and implementation of
state policy

The term „global governance“ is not used solely descriptively, and often has normative force. Its
normative content may be rooted in the paradigm of sustainable development, in terms of both
its requirements for forms and goals of political regulation. Where nonstatal actors are included
as stakeholders in decision making and implementation under global governance, this
addresses a basic prerequisite of sustainable political processes - the integration of those
affected into dialogue and consensual decision making and implementation. Even more evident
are the connections between global governance and the paradigm of sustainable development
in their basic goals of, preferably globally, establishing and maintaining ecological, social and
economic security today and in the future (see also Brozus / Take / Wolf 2003).

The desirability of integrating civil society actors concerned with the general welfare does not
seem to raise special problems in either conceptual or practical terms, even if there is a
constant issue with their questionable democratic legitimation (at least as it appears in the
conceptual framework of the model of a majority representative government). Initially, however,
it is surprising - particularly in connection with the concept of sustainable development - to
encounter repeated references (for example, in the Preamble to Agenda 21) to the compatibility
of the private sector and general welfare2. This surprise is due not least to the fact that the role
of transnational companies in the development policy debates since the 1970s has been asso-
ciated much more - and certainly not entirely wrongly - with causing problems rather than
solving them. Even though the neo-liberal swing of the pendulum, which has been one of the
key factors in the political regulation debate has gone too far in many ways, it has nevertheless
helped cast the role of the economic global players in a rather less prejudiced light.

In the field of forest certification, which - as will be shown in more detail below - fits in well with
the concept of global governance, private sector actors are already playing a significant role. In
this case, the regulatory gap that their integration is designed to fill is the transnational nature of
the problem of ecologically, socially and economically sustainable forest management, which
exceeds the capacities of the individual nation states. Forest certification operates at the
national or even regional level, tackling the problem at its roots. While state regulation falls short
of the demands posed by the complexity and dynamism of the interplay between actors in forest
management, forest certification systems are much better at dealing with this because they start
by getting all those involved around the table. This is the only way to achieve decisions which
can be sustained in the long term and are accepted by all involved, so making it possible to
close the regulatory gap at both national and international level. At the international level, the
regulatory gap is particularly evident where there have already been various attempts to find a
solution on a purely intergovernmental basis, within the framework of international organisations

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Nina Bressel / Klaus Dieter Wolf

such as the International Tropical Timber Organisation (ITTO) or the Intergovernmental Forum
on Forests (IFF). However, this approach has yet to produce any successful breakthrough. This
makes it all the more urgent to take alternative forms of political control in which private sector
actors also play a significant role seriously, and to look at their possibilities and risks more
closely.

Taking forest certification as a political regulation instrument, the following section presents
three different forms of regulation which arise out of expanding the group of actors to include
civil society and private sector actors. These three forms each represent a specific ratio of
public and private regulation. Following the initial, purely descriptive review, the second step is
an analytical and normative investigation of what requirements cross-border political regulation
generally needs to satisfy in order to meet the demands of sustainability. These two steps
provide the basis for offering some points of reference for the conception and evaluation of
forest certification systems.

Three forms of political regulation

As noted above, we are currently looking at changing models of political regulation that are
summarised in political science under the heading „global governance”, which mark a „transition
from binding, hierarchical decision-making structures to network-like decision making structures,
including a whole range of nonstate actors” PATTBERG 2004a: 3). This puts the focus on three
categories of actors - state, civil society and private sector - on the playing field of political
formulation and enforcement of regulations. The way they collaborate gives rise to novel (or at
least clearly identified for the first time) regulatory approaches, which can be roughly divided
into three categories. First, there is still the conventional purely state regulation. In this,
regulations are formulated and enforced in a hierarchical and legally binding form, either
unilaterally or intergovernmentally, or in international organisations. A second form is known as
the multi-stakeholder initiative. This covers regulatory approaches which may include a large
number of different actors from all three categories. Combining the different constellations of
actors with the conceivable modalities for participation results in numerous variants within this
category. The state may appear here as a purely cooperative partner, as the initiator of the
regulatory approach, or not at all. This is accordingly a regulatory approach in which compliance
is not imposed from above, but is the result of consensual and reciprocal commitment. The third
category can cover either purely private-sector voluntary initiatives, such as company-specific
codes of conduct or industry agreements, or purely civil-society initiatives, such as networks of
individuals and NGOs. This form of regulation is an approach with little binding force3.

All three categories can be found in forest management regulation. The ITTO, for example, is an
intergovernmental organisation in which civil-society and private-sector actors have the status of
observers and advisers, but which ultimately reserves authoritative decision making for the
states involved. Another project with state participation is the International Organization for
Standardization (ISO)4. However, as government representatives participate in the decision
making process to a varying extent from case to case, and as they also comprise only part of
the spectrum of actors, this organisation is in fact a multi-stakeholder initiative5. Another
member of this category is the Forest Stewardship Council (FSC), although here the state

189
Three forms of political regulation

instances are not directly involved in formulation (and enforcement) of political regulations, and
it is a regulatory partnership within the private sector6. Finally, there is the Tropical Forest Trust
(TFT), a purely private-sector regulatory approach, currently with 29 member companies which
want to increase the share of FSC-certified wood in their product range. Purely civil-society
initiatives, on the other hand, include the Rainforest Action Network (RAN), whose influence on
policy is due to effective PR campaigns and information work.

The description of the various regulatory approaches shows how they typically diverge from or
even reject the traditional model of a hierarchically regulatory state, each in their own charac-
teristic way. In some cases, the state still appears as a cooperative partner, in others it
withdraws entirely. To make possible statements about how best to configure political regula-
tion, and what mix of state and private regulation to give preference to, we need suitable criteria
for both the emergence and the results of formulating and enforcing regulations. Political
regulation must be able to deal effectively with the problem needing regulation. This alone,
however, is not enough, as it leaves unresolved the question of who decides what solution to
adopt, and how they do so. This brings up the question of democratic legitimation, as political
regulation can only be sustainable if it is based on broad acceptance.

The following section looks more closely at the requirements that have to be met to satisfy the
joint requirements of effectiveness and democratic legitimacy.

Requirements for effectiveness

One way to rate the quality of political regulation is in terms of its effectiveness. Three dimen-
sions can be distinguished here for „measuring” effectiveness. First, regulation must be reliable,
actually address existing problems requiring regulation, and create an appropriate coverage of
regulation in the specific problem area (output). Second, formulation and enforcement of
regulations must satisfy the requirement of robustness, i.e. compliance must be ongoing and
the associated behavioural modifications should also survive changing environments, such as
market conditions (outcome). Last but not least, there should be a successful solution (aligned
with the goals of the regulatory initiative) to the actual problem requiring regulation (impact).

Applied to the instrument of forest certification, these requirements mean that the above
regulatory gap (at both national and international level) should be actually addressed (output),
that companies should not withdraw from certification at the next opportunity (outcome), and
that forest management can ultimately be configured to match the paradigm of sustainable
development (impact).

With regard to the reliability and robustness of political regulation, it might be supposed at first
glance that these are heavily dependent on the motivations of the actors involved - for example,
company behaviour is highly rational in economic terms, which makes it unlikely that it will be
reliable or even aligned with the general welfare in the long term. However, it is important to
bear in mind that these actors are not operating in a vacuum, but already have a social and
political environment. One example of what happens when market rationality encounters an
environment which is complex and steeped in norms is the FSC, which has already succeeded
in some instances in integrating different demands by various actors in fora committed to the

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Nina Bressel / Klaus Dieter Wolf

paradigm of sustainable development. It is already clear that forest certification as a political
regulation element seems to have the potential for both the certified companies and for
consumers and other affected groups (such as the indigenous population) of being able to
identify problems arising out of forest utilisation and also provide a long term solution. However,
it does not do so automatically, and in particular it may not be robust in the long term unless it
succeeds in genuinely offering all parties access on an equal footing to decision-making
processes.

This brief outline of the three dimensions of effectiveness is certainly not a sufficient basis for
making a qualified judgment in practice. Even if it were possible to develop practicable
yardsticks, there is still the problem of the availability of data. In many cases, this is likely to be
virtually impossible, as international and transnational political regulation is rarely so transparent
that there would be no problems here. However, the criterion of transparency itself is applicable
in evaluating political formulation and enforcement of regulations. It is part of the second
criterion for the quality of government, which involves both the legitimacy of the political result
that we have been considering so far (output legitimacy) and the democratic legitimacy (input
legitimacy)..

Requirements for democratic legitimacy

As already noted above, it is not enough for political formulation and enforcement of regulations
to be effective solely in the sense of reliability, robustness and problem solving capability. In
addition, there are certain requirements for legitimacy, based on the fact that formulation and
enforcement of regulations - whoever is ultimately involved - will almost always have direct or
indirect consequences for the general and individual welfare. The process of political regulation
must accordingly meet three requirements on the input side of legitimacy. First, it must ensure
control of power and rule. It is important here that responsibility should be identifiable and
unambiguously defined, and that there are institutionalised mechanisms to bring those respon-
sible to account (procedural requirement). Given the failure of states in the face of globalisation,
a functioning market and public opinion could serve as a functional equivalent of lacking institu-
tional checks and balances for the purpose of controlling rule. Second, the criterion of democ-
ratic self-determination implies that the principle of congruence should apply, i.e. those who are
affected by a rule must (be able to) participate in setting the rule (participatory requirement). At
the global level, and given the absence of a global state, this requirement would favour the
multi-stakeholder initiative approach (if we stick with the three models of political regulation
outlined above), specifically in a form which involves all potentially affected actors as a way of
(re)establishing congruence between the authors and target groups for political regulations. The
third requirement is material in nature. One possibility of concretising the legitimacy of political
regulation in its content as well could be to review the formulation and enforcement of
regulations for their congruence with generally recognised standards for general welfare. To do
this, however, it is first necessary to identify such standards. In addition, there is the problem of
competing standards, and the associated question of the greater or lesser importance of a
specific standard. With regard to forest certification, we can say that the requirements of
democratic legitimacy and materiality may not be adequately met when referring to the standard
of sustainable development, as either the standard itself or the reference to it may not be

191
Requirements for democratic legitimacy

specific enough. However, a general determination of how specific standards or references to
them must ultimately be to permit consideration of their material legitimacy is only possible on a
case-by-case basis.

Forest certification as an instrument of political regulation must also be legitimate in the sense of
these three dimensions, as this also involves a collectively binding allocation of values, for
example in the form of setting standards for the rights of indigenous peoples. Developing a
yardstick for evaluating the democratic legitimacy of forest certification systems is at least as
difficult as in the case of effectiveness, as already suggested in connection with the material
dimension. Another problem in evaluating the content of forest certification approaches may be
the current large number of different certificates, requiring an unreasonable amount of effort on
the part of the consumer to evaluate them. However, it is worth tackling the problems of
legitimacy, as this is the only way to ensure in the long term that forest certification as an
instrument of political control is ecologically, socially and economically credible, and can rely on
broad acceptance, making its implementation possible.

Conclusions

The aim of this paper was to outline various forms of political regulation in the context of cross-
border problems in the light of the requirements implicit in the paradigm of sustainability which
could also apply in the field of forest certification. To evaluate the quality of formulation and
enforcement of regulations that are collective (i.e. binding on the target groups for the
regulations) the two criteria of effectiveness and democratic legitimacy were expanded along
three dimensions. It should be clear that alternative models for control - alternatives to
hierarchical regulation by state actors - need not be damaging to the effectiveness and
legitimacy of a government, and can on the contrary contribute important resources for political
control which complement those available to the state. Such approaches can also assume the
function of an imitative or provisional pioneer, leaving open the question of possible subsequent
return to (inter)state control. Which mix of public-sector regulation and private-sector
(self-)regulation ultimately and under what conditions best meets the requirements of
effectiveness and legitimacy are questions which can only be answered in dialogue between
research and practice. For forest certification, we can say that it will be able under certain
circumstances to close existing regulatory gaps, and through a process of dialogue and learning
to bring us closer to the goal of ecologically, socially and economically sustainable forest
management. At the same time, it is important to avoid the error of zealous certification
involving certificates which do not deserve their name in terms of effectiveness and legitimacy.

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Nina Bressel / Klaus Dieter Wolf

Notes
1
For a detailed analysis of the corporatist model, see BENZ 1997.
2
In the past, business administration has taken the lead in looking at the opportunities and risks of
private sector concern with the general welfare, under the heading of corporate ethics. For overviews,
see DONALDSON 1989, STEINMANN / LÖHR 1994, ULRICH 2001 and SCHERER 2003. For a rela-
tively critical study of the role of companies in political regulation, see BRÜHL et al. 2001.
3
On the differences between the second and third forms of political regulation discussed here, see also
PATTBERG 2004.
4
The ISO 14000 series („Environmental management”) and specifically the 14020 series („Environ-
mental labels and declaration”) are directly relevant to forest certification.
5
For case studies on multi-stakeholder initiatives from areas other than forest management and on the
role of different actors in these, see e.g. LÖHR 2004 for PUMA or DINGWERTH 2003 for the World
Commission on Dams, where the latter also deals with the input legitimacy of global political networks
(vid. inf.).
6
However, the state plays a role in FSC which should not be underestimated, as Principle 1 states that
forest certification must always comply with national laws and regulations and also international
treaties and agreements to which a country is signatory

193
References

References

BENZ, A. (1997): Kooperativer Staat? Gesellschaftliche Einflussnahme auf staatliche
Steuerung. in: KLEIN, A. / SCHMALZ-BRUNS, R. (eds.): Politische Beteiligung und
Bürgerengagement in Deutschland. Möglichkeiten und Grenzen, Bonn, 88-113.

BROZUS, L. / TAKE, I. / WOLF, K. D. (2003): Vergesellschaftung des Regierens? Der Wandel
nationaler und internationaler politischer Steuerung unter dem Leitbild der nachhaltigen
Entwicklung. Opladen.

BRÜHL, T. et al. (eds.) (2001): Die Privatisierung der Weltpolitik. Entstaatlichung und
Kommerzialisierung im Globalisierungsprozess. Bonn.

DINGWERTH, K. (2003): Globale Politiknetzwerke und ihre demokratische Legitimation. Study
for the World Commission on Dams, Global Governance Working Paper No 6,
Potsdam/Berlin/Oldenburg.

DONALDSON, T. J. (1989): The Ethics of International Business, Oxford.

LÖHR, A. (2004): The Changing Role of NGOs for Business: Instruments, Opponents, or
Professional Partners? EGOS - Colloquy July 1-3, 2003, Ljubljana.

PATTBERG, P. (2004a): „Private-Private Partnerships“ als innovative Modelle zur
Regel(durch)setzung? Möglichkeiten und Grenzen eines neuen Konzeptes am Beispiel des
Forest Stewardship Council (FSC). in: BRÜHL, T. et al. (eds.): Unternehmen in der Weltpolitik:
Politiknetzwerke, Unternehmensregeln und die Zukunft des Multilateralismus. Bonn, op. cit.

PATTBERG, P. (2004b): The Institutionalisation of Private Governance. Conceptualising an
Emerging Trend in Global Environmental Politics, Global Governance Working Paper No 9,
Potsdam/Berlin/Odenburg.

SCHERER, A. G. (2003): Multinationale Unternehmen und Globalisierung. Zur Neuorientierung
der Theorie der Multinationalen Unternehmung. Heidelberg.

STEINMANN, H. / LÖHR, A. (1994): Grundlagen der Unternehmensethik. 2. Ausg., Stuttgart.

ULRICH, P. (2001): Integrative Wirtschaftsethik: Grundlagen einer lebensdienlichen Ökonomie.
3. Ausg., Bern.

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Jürgen Hess

Impacts, obstacles to and risks of forest certification
Jürgen Hess

Goal and approach

The instrument of forest certification has been with us for 15 years now. In 2004, the Forest
Stewardship Council (FSC) celebrated its tenth anniversary, and the Programme for the
Endorsement of Certification Schemes (PEFC, formerly Pan European Forest Certification) its
fifth. Numerous people involved have invested a lot of resources and energy into developing
and implementing the instrument, and have attached high expectations (ELLIOT, 2000). The
vision of certification involves offering an incentive for raising the standards of forest manage-
ment as a voluntary market instrument. In addition, however, it aims to promote models of
sustainable consumption in which credible proof of sustainable forest management enters
consumer behaviour as the primary quality characteristic throughout the entire value chain, from
production to the consumer.

The aim of the present paper is to compare the expectations and concerns associated with
concrete application of the instrument with the impacts observed to date. It will go on to analyse
the obstacles and failures which have typically confronted certification to date. The comparison
of impacts and obstacles leads to a few crucial risks, which have to be mastered for future
progress in certification.

Although certification has been applied in practice for some 15 years, it has to be remembered
that this is still too short a period to identify the particularly important longer-term impacts. There
are very few empirical studies of the impacts of certification to date. Existing studies of certifica-
tion are based on individual case studies of certified enterprises and countries where these are
located, or where processes for developing national certification standards can be tracked.
These studies pay very limited attention to the impacts of the instrument (NUSSBAUM /
SIMULA 2004: 49).

Assessments of the success or failure of forest certification have so far always given very great
weight to the certified area. Only recently have various authors based their assessment of the
instrument on other quality characteristics and started classifying these (cf. GULLISON 2003;
MOLNAR 2003; NUSSBAUM / SIMULA 2004; RICHARDS 2004; SEGURA 2004;
BUTTERFIELD et al. 2004; SIMULA et al. 2004; WWF 2005). The impacts and associated
obstacles and risks identified in the present paper are broken down for consideration into
enterprise and sectoral levels.

Impacts, obstacles and risks at the enterprise level

Forest management

There are major changes at the operational level, primarily in the practices in forest manage-
ment. These include e.g. measures to ensure future availability of products from the forest,

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Impacts, obstacles and risks at the enterprise level

standards for forest roads to minimise the impact on soil and water, improvements in silviculture
and logging (e.g. techniques for reduced impact logging) and regeneration of marginal sites.
Specifically in the tropics, the often unsustainable logging of timber species has been replaced
by the use of a broader range of species and an increase in the stock of timber (NUSSBAUM,
SIMULA, 2004: 30; RICHARDS 2004: 12).

Even more important are further developments in an operation’s management system due to
the introduction and use of improved methods of mapping, inventory, planning, monitoring and
evaluation, and documentation. On the other hand, certification often involves obstacles which
are hard for small-scale forms of forest management to deal with, resulting from the require-
ments for documentation, planning, monitoring and process instructions (NUSSBAUM / SIMULA
2004: 30).

Preservation of biodiversity

The question of how far certification actually improves ecosystem functions, increases biodiver-
sity, or promotes the survival of endangered species is an ongoing matter of controversy. Based
on a review of a whole series of case studies and articles, NUSSBAUM and SIMULA (2004)
come to the conclusion that improved protection of biodiversity seems to be a consistent benefit
of certification. Frequently, corrective action requirements in the context of conformity
verification relate to rigorous monitoring and reduction of environmental influences, with the
emphasis on improved protection of representative ecosystems and rare or endangered species
(NUSSBAUM / SIMULA 2004: 27-29). GULLISON (2003) describes that certification with the
FSC label demonstrably requires a whole range of significant modifications in management.
These in turn generate a direct benefit for preserving biodiversity, which supports the
effectiveness of certification at the practical implementation level in productive forests. However,
a prerequisite for protecting biodiversity is an area whose size matches the ecosystem to be
protected. This is occasionally greater than the size of the individual enterprise as a certification
unit (NUSSBAUM / SIMULA, 2004: 27-29).

The limits to the effectiveness of certification emerge in the areas of the conversion of forest
areas to other land uses and the destruction of High Conservation Value Forests (HCVF).
Surveys and planning for HCVF in certified enterprises have increasingly become important
elements in certification processes (PROFOREST 2003). At the same time, the conversion of
forests to other land uses and the efficient protection of HCVF are typical areas where comple-
mentary measures to certification need to be promoted. These include regulatory measures to
prevent illegal wood use and conversion of forests. They also include e.g. proactive expansion
of markets and rewards for environmental services, in order to increase the economic competi-
tiveness of certified enterprises compared with other forms of land use. Large-scale forestry or
group and regional certification of small-scale forest management forms offer solutions for
ensuring suitable scales for protecting biodiversity.

Social aspects

The application of forest certification has led to more conscious awareness and constructive
handling of social aspects of sustainable forest management. It is reported that employees in

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certified concession sites enjoy improvements in labour law, health, job security and wages.
This also affects the local population in concession areas. Outstanding elements in this area are
the negotiation and implementation of compensatory mechanisms, conflict resolution and
improvement in the organisation of the local communities affected (RICHARDS 2004: 7).

The positive impacts of certification in the social sphere also include non-monetary benefits of
communal forest management. For example, local communities have achieved a better negoti-
ating position and higher institutional status in forest policy processes, and established them-
selves as legitimate forest users in dealings with the state and environmental representatives of
civil society (MOLNAR 2003: 13). In addition, there is the resolution of conflicts over indigenous
land rights and local community boundaries (RICHARDS 2004: 8).

Perhaps the greatest merit of certification overall is to have gained far greater attention to the
social dimension of sustainable forest management than was the case just a few years ago.
Much more importantly, certification provides a framework for the actors involved to develop
practical solutions both in the context of standard development and implementation processes
with their political repercussions and in the certification of individual enterprises. This has, for
example, led to greater articulation by representatives of the private sector and the local
population of their previous mutual suspicion and to the reduction of the resulting distance
through certification processes.

The social dimension of sustainable forest management is, however, easily the most difficult to
handle, not only in the tropics but also in the European setting. Complex and small-scale living
conditions, which also differ greatly between locations, and local values and standards handed
down over countless generations - such as different ethnic perceptions of land ownership - are
in some cases very difficult to integrate into either labour law, land law or other necessary
regulatory codes or into certification standards. They pose major challenges, obstacles and
risks to certification. This is demonstrated by arguments that certification lacks the potential to
resolve this (COLCHESTER et al. 2003), by difficult certification processes (MEYER 2003), and
controversial debates at the level of individual enterprises, as in Malaysia (MTCC 2005; BRUNO
MANSER FONDS 2005). However, enterprise level certification under FSC is repeatedly
showing that complex social problems in the tropics can be solved, at least locally (MEYER
2003). Conversely, studies at the enterprise level are also showing the problems in adequately
handling the social dimension of sustainable forest management increasingly in Europe too
(WWF 2005). Forest certification under FSC in the cases studied in various countries also
appears in the European context as a mechanism which not only makes social aspects
apparent, but also makes them more concrete and supplies innovative solutions. „Forest
certification has led to an improvement across all countries in the implementation of health and
safety legislation, including the provision of better equipment and training, the use of safety
procedures, and the reliance on properly qualified forest workers. Public safety has also
improved through the implementation of risk assessments and better signage of work zones”
(WWF 2005).

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Impacts, obstacles and risks at the enterprise level

Market incentives

The situation in enterprises already certified is generally still dominated by a lack of significant
or any reward for certified forest products in the relevant markets (GULLISON 2003: 158;
RICHARDS 2004: 23). There are also demonstrably cases where certified forest products enjoy
a remarkable price premium. However, these are clearly restricted to niche markets, such as
specific tropical sawn timber or plywood products, where there is a shortage of certified goods.
The premia disappear again as soon as the shortage is offset (GULLISON 2003: 158). Although
certified forest products are setting the trend on the supply side, higher prices cannot yet be
expected as a result (NUSSBAUM / SIMULA 2004: 39-40).

Where higher market prices are nevertheless achieved for certified products, these generally do
not trickle down to the raw materials producers. The profits are made by dealers and processing
industry, not by producers (PINTO DE ABREU / SIMULA 2005). While many trading companies
are reporting markups, trading companies which pass on the higher prices to raw material
producers or processing enterprises are in the minority. (NUSSBAUM / SIMULA 2004: 39/40)

Higher market prices for certified products are accordingly not yet the driving force behind
certification. Instead, indirect benefits such as (and specifically) lower costs (SIMULA et al.
2004) and easier market access play a greater role than markups. It is, for example, already
clear that companies whose production processes are not certified and who also have
occasional public relations problems with their wood supply (e.g. plantation wood from
converted natural forests or wood from old growth forest) will have to accept lower market prices
if supply exceeds demand (NUSSBAUM / SIMULA 2004: 39-40).

Half the world’s certified forests are subject to industrially-oriented private sector management
with large-scale units, while 23% of certified forest area is managed by non-industrial private
forest owners. Certified forests under communal management currently account for a share of
2% (PINTO DE ABREU / SIMULA 2005). Statistically, forest certification has so far primarily
favoured large-scale forms of forest management. This is certainly also the result of structural
comparative advantages of these forms of operation in the market and marketing sectors, and
particularly in the mass product segment, especially since innovative companies in particular
are clearly succeeding in restructuring their production procedures.

Local communities and small-scale enterprises have, however, had great difficulty in estab-
lishing secure and long-term market links in the face of the competition. MOLNAR (2003)
summarises the situation as follows: „They (communities) are unable to keep their costs of
production low because of low volume, poor road infrastructure, lack of enterprise efficiency,
and distance from markets. Except where they have associated, few communities can deliver a
consistent volume of a similar quality to attract buyers”.

The situation will continue to deteriorate if wood from the established commercial plantations in
developing countries reaches the local, regional and global markets. This will substantially
increase the risk of undermining producers in the natural forests who cannot compete with
plantation wood. A significant example of this is the industry in the north of Mexico, which is
already importing certified plantation wood from Chile with a more consistent quality and

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Impacts, obstacles to and risks of forest certification
Jürgen Hess

dimensions and at lower prices than it can produce from certified Mexican local community
woods. MOLNAR concludes: „The communities face the double challenge of having a number
of steps complete to develop an efficient enterprise, which can be certified at a reasonable cost
of audits and investments, and having to look to a future where their natural timber and commu-
nity wood cannot compete with plantation wood. Forest certification has not developed the
expertise to advise or guide communities on these real market issues”’ (MOLNAR 2003: 21).

This imbalance jeopardises certification’s claim to address the social challenges of sustainable
forest management in particular, thus significantly increasing its relevance for poverty, and
exposes it to a loss of credibility and support from the relevant actors. Additional complementary
measures to improve market access for local communities are urgently needed. These include
marketing strategies which show publicly that the products involved were made by peasants
and indigenous population groups and which try either to create suitable market channels or to
mobilise existing market mechanisms, such as the Fair Trade Initiative. Governments must
lower statutory barriers to small-scale forest management. Forestry agencies, donor projects
and NGOs should concentrate much more closely on providing services to establish improved
marketing structures. These include expanding and rewarding commercial provision of nonwood
products and environmental services (MOLNAR 2003: 42-44).

Costs of certification

The costs of certification include the direct costs of the certification process itself, which depend
very strongly on the size of the enterprises and the distance the certifiers have to travel. Direct
costs are relatively low in large and intensively managed industrial production units, but can
become enormous for small and medium-sized businesses, making it difficult for them to enter
the added value chains for certified products. Direct costs amount for example to 2-3 US$ cents
a cubic metre in large enterprises in Poland and the USA, compared with 19 US$ cents a cubic
metre for plantations in South Africa. In other tropical forest enterprises, the direct costs vary
from US$ 0.26-1.10 or up to US$ 4 a cubic metre for small producers in Latin America
(GULLISON 2003: 161).

In the tropics, indirect costs due to the introduction of certifiable production processes are far
more significant than direct costs. These include investment in infrastructure and technology to
enhance the efficiency of logging, combined with more conservative use of resources. They
also include higher wages due to compliance with statutory wage and social security regulations
(GULLISON 2003: 161) and the costs of measures to secure biodiversity, advanced training,
documentation and reorganisation of wages, e.g. shifting from piece rates to hourly wages. In
the tropics, however, the decisive factor for the occasionally enormous level of indirect costs
consist of the implications of converting forest operations from overexploitation to quantitatively
sustainable use of resources. The profits foregone through not overusing the stands in an
unsustainable manner create opportunity costs which exceed the potential compensation from
existing and even future ecologically sensitive markets.

The consequence is that high direct costs of certification and high indirect costs from the
introduction of certifiable production processes are often seen by producers as a barrier to using
the instrument at the enterprise level, so that these producers are not inclined to embark on a

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certification process. To reduce this risk, increased use of the potential for efficient reduction of
direct costs is required. However, reducing the high indirect costs of certification requires
regulatory action, as improvements in efficiency in operating procedures and certification alone
are not sufficient.

Sectoral impacts, obstacles and risks

Policy and governance

The relationship between national policies and forest certification has been dominated since the
start of certification by tensions and particularly by very different reactions by national govern-
ments. Original positions start with active support in introducing the instrument, for example
through reforms in policy and legislation, or through direct financial assistance to certification
initiatives, and continue through a passive attitude which allows scope for national and external
standards initiatives, extending as far as explicit rejection. With time, and based on different
experience, governments have modified their attitude to certification, which is expressed in very
different modes of action. In several countries, government participation in certification
processes has evolved into direct commitment to developing and implementing national certifi-
cation systems, as in Ghana or Malaysia. Others support the process of establishing interna-
tional systems, as in Mexico. Several are hesitant or indifferent to certification processes, as in
Cameroon (SEGURA 2004: 5). SEGURA (2004) continues: „Also, the fast and dynamic evolu-
tion of the certification process and the very limited documentation of its impacts as a new policy
instrument to achieve SFM have been partly responsible for the limited understanding and
reluctance of governments to accept it and promote it”.

At the same time the role of certification in addition to its original aim as a voluntary market
incentive is steadily consolidating its status as a „soft” policy instrument. Positive impacts of
certification processes on national forestry policies and regulatory environments can be
identified for the following areas:

• Participation in forest policy processes by the relevant actors
Processes to formulate national FSC standards by the relevant national initiatives have
produced positive influences. The key feature of FSC standards development is a significant
improvement in participation by the various actors, with striking examples in countries like
Brazil, Bolivia and South Africa. Increased acceptance of local community representatives in
local and national political fora, increased awareness of the potential of sustainable forest
management, increasingly participative and decentralised forest policy processes, and greater
transparency in enterprises and value chains are all demonstrable results of certification
(RICHARDS 2004: 4).

Without distinguishing between individual certification systems, SEGURA (2004) describes the
introduction of a new culture into social negotiating processes, which is characterised by
increased awareness of sustainable forest management, as a primary contribution of
certification to forest policy developments. Certification has in particular strengthened local
actors like local communities and NGOs, which otherwise have only limited access to forest

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policy processes (SEGURA 2004: 7). He continues: „New forms of dialogue have emerged
where forestry issues are addressed at local, national, and even regional levels improving the
transparency of forest practice, the understanding of what should be deemed good forestry and
the appropriate role of different groups in the process”.

Of decisive importance in this is that this category of impact is attributable much more to partici-
pative processes for developing standards for sustainable forest management than to cumula-
tive biophysical or sectoral impacts of the certification of individual enterprises
(RAMETSTEINER 2000, quoted in SEGURA 2004: 7). In other words, the development of
national standards in participative processes has the potential to change the quality of forest
policy and regulatory environments. The certification of individual enterprises accordingly does
not rise above the level of model approaches. It is the national working groups on forest
certification in the various countries in particular which have brought together the actors who
have traditionally avoided cooperation on forest problems, and who were then put in a position
to have a positive influence e.g. on conflict-laden areas such as the long-running internal and
external disputes over land rights in Mexico. On the other hand, certification also continues to
face major problems in countries with complex ethnic and political structures. The success of
certification will depend on how far it succeeds in difficult and complex forest policy contexts and
unequal power constellations among the actors involved in providing practicable, verifiable and
balanced answers for all participants.

• Influence on national legislation and programmes for sustainable forest management
The influence of certification on the design and implementation of national forest policies and
forest programmes can be direct or indirect. As in Brazil, Malaysia and Mexico, impacts are
more apparent in countries where local actors have taken ownership of the certification process,
where there is active participation by local and national government agencies, and national
working groups and certification agencies play a prominent role. By contrast, SEGURA (2004:
9) sees the influence as relatively restricted in countries like Zambia or Cameroon, where the
certification process is being promoted by NGOs unilaterally or with little integration of local
actors, and where governments are marginalised in the process.

The influence of certification on national regulatory environments has so far generally been
restricted to implementing existing legislation rather than reforming the content of the laws
(BASS et al. 2001). Certification as a complementary instrument can support compliance with
local regulations, representing an essential gain for countries where the technical and structural
capacities of the executive agencies for implementing and monitoring legislative provisions are
limited. Conversely, these effects are limited where only a very restricted number of producers
have the potential to meet international or national standards. In the few exceptions to date
where there has been an interactive process between reforming forest legislation and
certification, there is however a possibility of incorporating certification incentives for forest
owners directly into statutory provisions. An example of this is Bolivia (SEGURA 2004: 10).
At the same time, the potential for influence of certification as an executive mechanism is limited
by the requirement of it to be voluntary. Governments use very different approaches and
strategies to expand their freedom of action in this respect. In Russia, legislation for a
mandatory national certification initiative was introduced in 1997 in order to ensure monitoring of

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Sectoral impacts, obstacles and risks

wood extraction from concessions in public-sector forest areas. This approach was, however,
never ultimately implemented, and is also viewed critically due to its inflexibility and vulnerability
to corruption and illegality. Other approaches concentrate on creating a range of incentives for
producers who either already have a certificate or are demonstrably in the process of certifica-
tion. These include tax breaks and exemption from mandatory state controls in Bolivia,
facilitated access to national government programmes in Mexico, and tying grants of forest use
rights to certification in Guatemala and South Africa.
A major risk in mobilising the potential of certification, either as a complementary mechanism for
the executive or in supporting reforms in forest policy and legislation, is the lack of adaptation to
local situations. Local traditional law, rural communities, ethnic minorities and women should not
be subject to discrimination in standard development and implementation (KAIMOWITZ 2003).
This is particularly true in areas where land rights questions are complicated or overlapping, or
where there are nomadic population groups or populations with extensive forest use (SEGURA
2004: 11).

• Influence on sustainable management of state forests
Forests under public ownership account for a major share of the forest areas certified to date.
The governments involved have tried to improve their reputation with civil society and the trade
in this way, using certification to demonstrate various approaches to sustainable forest
management to other forest owners. In the process, governments have also been led to rethink
their own role and influence. BILLS (2001) writes: „Our (the Government of the United Kingdom,
UK) experience of certification has shown that it is more than just a marketing tool. Continuing
the theme of new ways of doing business, certification is proving to be a vehicle for real efforts
to promote sustainable forest management in the UK” (BIILS 2001: 5).

Governments are increasingly accepting the function of certification as a „soft” policy instrument
which can make an important contribution towards attaining sustainable forest management.
Governments as large and influential forest owners should continue to play an active role in
national, regional and international certification processes (SEGURA 2004: 13).

Overall, however, the complexity of the relationships between national policy and governance
on the one hand and certification on the other has yet to be clarified in all respects. Perhaps too
much has been expected too quickly at the interface between governance and certification in
particular. If used as a pure market instrument, certification can only have a limited influence on
difficult environments and fundamental economic problems. If restricted to its function as a
market mechanism, certification can only have a limited influence on illegal wood use,
corruption or other negative aspects of governance. These problems generally arise out of
weaknesses in the legal and regulatory environment and public respect for law and order. A
market instrument with a market which is still small does not impact these problems
(RICHARDS 2004: 5).

Specifically in the tropics, certification is still faced by a major discrepancy between current
practice and internationally recognised principles of sustainable forest management
(RICHARDS 2004: 9). Application of the instrument faces barriers in the tropics such as high
interest rates, uncertain land title, political and economic uncertainties and large quantities of

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cheap forest products on the markets from conventional forest exploitation (GULLISON 2003:
161-162). To deal with these tensions, certification is subsidised by donors, NGOs and govern-
ments, as for example in Mexico (RICHARDS 2004: 8). This is generally justified by the early
stage of development of a new market instrument with weak market incentives, with the high
biodiversity of the tropical forests, and with aspects of poverty reduction. However, this also
involves substantial risks. These include the passivity of the enterprise management involved,
disruption of market forces and efficiency losses (MARKOPOULOS 2003, quoted in RICHARDS
2004: 9). There is also the risk that this support will end before either functional and economi-
cally viable market mechanisms are established or difficult political environments are improved.
The great risk in all this is that support will be withdrawn much too early. This leads to certifica-
tion subsequently being rejected by producers, and follow-on audits being abandoned.

Markets

The potential supply of certified wood is currently estimated at 585 million m3, of which c. 35%
comes from plantations. This potential volume is considerable, representing 17% of global
roundwood production. Nevertheless, only a limited share of this volume is sold with a certifi-
cate. More than 5,400 Chain of Custody certificates are awarded in 74 countries, 80 of them in
developing countries, more than 70% in Europe alone. The share in the total trade of wood from
certified sources is, however, still slight (NUSSBAUM / SIMULA 2004).

The quantitative impact of certification on trade still does not qualify as significant. Despite this,
and given the fact that these figures did not exist at all only a few years ago, this market
segment has evolved into one of the most dynamic trade sectors. There is much to suggest that
the process is continuing to accelerate, and that certified wood will become the main flow in
trade in wood products over the next five years (NUSSBAUM / SIMULA 2004). Responsible
companies in the private sector have integrated demand for certified goods into their purchasing
guidelines, and more and more governments - primarily in Europe, such as the UK and
Denmark - are developing regulations for public procurement in which certified wood is given
preference in placing orders (ITTO 2005). The emergence of a buyer group in Brazil and the
growing interest of tropical domestic markets, as in Mexico and Brazil, are further indicators of
the influence of certification on major trading regions (SMERALDI / VERÍSSIMO 1999;
RICHARDS 2004: 27). A whole series of producers in tropical regions - mainly in South America
- have utilised demand for certified products to gain access to ecologically sensitive markets in
Europe and North America (NUSSBAUM / SIMULA 2004). As a result, certification has
demonstrably led to numerous producers and consumers rethinking their behaviour. In addition,
there are already service initiatives, such as the Global Forest & Trade Network (GFTN) created
by the World Wide Fund for Nature (WWF), and the private sector Tropical Forest Trust (TFT),
which provide services to promote certification and improve the positioning of certified products
on the market (RICHARDS 2004: 13-15).

At the same time, there still remains much to be done in terms of market access for certified
products in order to support broader application of the instrument in the tropics and subtropics.
Although demand for certified goods still currently exceeds the available supply, particularly for
high-quality tropical woods, markets have so far shown little willingness to generate
corresponding compensation for the higher costs of the enterprises producing these

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Sectoral impacts, obstacles and risks

(RICHARDS 2004: 26). At the same time there are reports that market segments for tropical
woods are being replaced by other products because no certified goods were available (ITTO
2005). The share of producers with access to ecologically sensitive markets, which essentially
remain limited to North America and Europe, is still minimal Many domestic markets -
particularly in smaller and poorer countries without significant export rates - are still not acces-
sible to certification.

Large-scale companies currently dominate the main routes to the markets, while small and
medium-sized firms and local community operations still have very limited access to markets.
Market communication about demand is so far essentially a process between companies,
consumer demand is still limited (PINTO DE ABREU / SIMULA 2005). Markets generally see
themselves as faced by the need to define which certification systems can be accepted and
recognised.

It seems that market requirements in consumer countries are being developed without adequate
participation by producers. This is leading to growing diversity in different requirement profiles
on the markets, making it difficult for tropical wood producers to retain a clear picture. There is
an urgent need here to use suitable communication mechanisms to establish convergence
between the needs of demand and producer needs (ITTO 2005).

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Impacts, obstacles to and risks of forest certification
Jürgen Hess

References

BASS, S. / THORNBER, K. / MARKOPOULOS, M. / ROBERTS, S. / GRIEG-GRAN, M.
(2001): Certification’s impacts on forests, stakeholders and supply chains. Instruments for
Sustainable Private Sector Forestry Series. International Institute of Environment and Develop-
ment, London, UK.

BILLS, D. (2001): The UK Government and certification. International Forestry Review
Vol. 3 (4).

BUTTERFIELD, R. / HANSEN, E. / FLETCHER, R. / NIKINMAA, H. (2004): Forest Certification
and Small Forest Enterprises. Key Trends and Impacts: Benefits and Barriers. Draft Version 6,
Rainforest Alliance.

BRUNO MANSER FONDS (2005): When will Malaysia start respecting the Penan people’s
rights? www.bmf.ch.

COLCHESTER, M. / SIRAIT, M. / WIJARDJO, B. (2003): The Application of FSC Principles 2
and 3 in Indonesia: Obstacles and Possibilities.

ELLIOT, C. (2000): Forest Certification: A Policy Perspective. CIFOR, Jakarta.

GULLISON, R. E. (2003): Does forest certification conserve biodiversity. Oryx Vol 37 No. 2 April
2003.

ITTO (2005): INTERNATIONAL TROPICAL TIMBER ORGANIZATION, International Workshop
on Phased Approaches to Certification. Bern. www.itto.or.jp.

KAIMOWITZ, D. (2003): Forest law enforcement and rural livelihoods. The International
Forestry Review Vol. 5(3).

MTCC (2005): Information Update - Sela’an Linau FMU 030305. www.mtcc.com.my.

MARKOPOULOS, M.D. (2003): The Role of Standards-based Approach in Community Forestry
Development. Findings from Two case Studies in Southeast Asia. RECOFSC Working Paper
2/2003 Bangkok.

MEYER, C. (2003): Good on the ground. Indigenous Orang Asli at the FSC-certified PITC-
concession in Peninsular Malaysia. Case Study carried out for the Tropical Forest Trust (TFT),
www.tropicalforesttrust.com.

MOLNAR, A. (2003): Forest Certification and Communities: Looking forward to the next
decade. Forest Trends, Washington.

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References

NUSSBAUM, R. / SIMULA, M. (2004): Forest Certification: A Review of Impacts and Assess-
ment Frameworks. Certification Paper Second Review Draft carried out for the Tropical Forest
Dialogue (TFD).

PINTO DE ABREU, J. A. / SIMULA, M. (2005): Setting the Scene: Overview and Implementa-
tion of Phased Approaches. Presentation at the ITTO International Workshop on Phased
Approaches to Certification. Bern. www.itto.or.jp.

PROFOREST (2003): Toolkit for Assessment of High Conservation Value Forests.
www.proforest.net.

RAMETSTEINER, E. (2000): The Role of Governments in SFM-certification. Discussion Paper
P/2000 - 1. Institut für Sozioökonomie der Forst- und Holzwirtschaft. Vienna.

RICHARDS, M. (2004): Certification in complex socio-political Settings: Looking forward to the
next decade. Forest Trends, Washington.

SEGURA, G. (2004): Forest Certification and Governments: The real and potential influence on
regulatory frameworks and forest policies. Forest Trends, Washington.

SIMULA, M. / ASTANA, S. / ISHMAEL, R. / SANTANA, E.J. / MARCELO M.L. (2004): Report
on Financial Cost-Benefit Analysis of Forest Certification and Implementation of Phased
Approaches. International Tropical Timber Council ITTC (XXXVII)/13.

SMERALDI, R. / VERÍSSIMO, A. (1999): Hitting the Target: Timber Consumption in the
Brazilian Domestic Market and Promotion of Forest Certification. IMAZON, Belem, Brazil.

THORNBER, K. (1999): Overview of global trends in FSC certificates. Instruments for Sustain-
able Private Sector Forestry Series. International Institute of Environment and Development,
London.

WWF (2005): The effects of FSC Certification in Estonia, Germany, Latvia, Russia, Sweden and
the UK. WWF European Forest Programme. www.panda.org/europe/forests.

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Forest certification in Brazil: advances, innovations and challenges
Adalberto Veríssimo / Roberto Smeraldi / Tasso Azevedo

Forest certification in Brazil: advances, innovations and challenges
Adalberto Veríssimo / Roberto Smeraldi / Tasso Azevedo

Summary

Of the countries in the South, in Brazil forest certification by the Forest Stewardship Council
(FSC) has progressed the most. The area certified by the FSC in Brazil reached 3 million
hectares in December 2004, placing the country fifth place worldwide. Brazil also has the largest
area of certified tropical forest in the world, with around 1.3 million hectares in the Amazon.
Brazil has been a benchmark in the strategic areas of promoting certification, for example with
the creation of the group of buyers of certified wood in 2000, or the setting up of the group of
producers of certified wood of the Amazon in 2003. Brazil furthermore held the first FSC
national trade fair and started a broad consumer campaign to promote the trademark. Such
advances are backed by the catalysing forces of the Alliance for the Consumption of Certified
Forest Products made up of the non-governmental organisations (NGOs) Friends of the Earth -
Brazilian Amazon, Imazon (Amazonian Institute of People and the Environment) and Imaflora
(Institute for the Management and Certification of Forests and Agriculture).

Introduction

Brazil is a forest country, harbouring around 5.5 million km2 of forest (65% of its territory), which
represents approximately 10% of the world’s forests and the second largest forest area, after
Russia. Brazil’s forests, and the Atlantic and Amazon Forests in particular, are home to one of
the richest biological diversities of our planet. Furthermore, they play a significant role in
conserving around 20% of the world’s freshwater reservoirs (PNF - National Forest Programme
- 2004).

The Amazon accounts for 66% of Brazil’s total forest coverage, while the Cerrados (lit.
savannah) account for 24%. The rest (10%) is made up of the remnants of the Atlantic Forest
along the coast, the Araucaria Forest in the south, Caatinga in the northeast region and patches
of deciduous forests at the transition between the Atlantic Forest and the Cerrado. In addition,
Brazil has approximately 55,000 km2 of forest plantations, most of them in the southeast and
south regions (LELE et al. 2000, LENTINI et al. 2004, PNF 2004).

Brazil’s forests are of increasing economic importance. In 2002, the production of paper and
cellulose, solid plantation wood, native wood (from the Amazon, in particular) and non-timber
products accounted for around 4% of gross domestic product (GDP) and 8% of all exports, and
generated around 2 million direct and indirect jobs (PNF 2004).

However, the majority of this production originates from non-managed native forests and non-
certified plantations. Despite this, Brazil has advanced significantly in the adoption of forest
certification (FSC) both in the plantation sector and in the native forests of the Amazon. In 2004,
the certified area reached 3 million hectares of which 57% belonged to the Amazon (natural and
planted forests) and the other 43% to the plantations of the southeast and south of the country.

207
Introduction

The purpose of this article is to present the advances made with FSC certification in Brazil, the
lessons learned, the challenges and the prospects for the next few years.

Evolution of Brazil’s certified area

The area certified by the FSC in Brazil reached 3 million hectares in December 2004, putting
Brazil fifth place world-wide, after Sweden, Poland, the United States and Canada. The certified
area of natural forests in the Amazon accounts for approximately 1.3 million hectares or 43% of
the total Planted forests in the Amazon already top 440,000 hectares or 14% of the total
certified in Brazil. The certified area of plantations outside the Amazon represents 33%, a large
part being plantations earmarked for pulp and paper production in the southeast and south of
Brazil. Finally, the certified natural forests in the Atlantic Forest and Araucaria Forest area make
up 10% (Table 1).

Table 1: Area certified under the FSC in Brazil as of December 2004
(Source: FSC Brazil 2005)

Type of Management Area Certified (ha)

Natural Forests in the Amazon1 1,291,381

Planted Forests in the Amazon 440,084

Natural Forests outside the Amazon 300,000

Planted Forests outside the Amazon 997,000

Total 3,028,991

Certification in the Brazilian Amazon

In the Brazilian Amazon, efforts to develop a socially and environmentally responsible forestry
sector are recent. Until 1996, forest management was virtually non-existent in the Amazon. It
was thanks to certification that forest management began to take hold in the region. In 2004, the
managed area of natural forests reached 3.2 million hectares, of which almost 1.3 million (43%)
corresponded to natural forests certified in accordance with FSC criteria. This constitutes
significant progress, but still is insufficient as timber from managed sources still represents less
than 10% of total production.

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Figure 1: Forest areas certified under the FSC in Brazil 2004

FSC’s involvement in the Amazon began in 1997 with the certification of Precious Woods, which
started off with an area of 81,000 hectares. Based in Itacoatiara, Amazonas State, that
undertaking played a decisive showcase role in the spread of certification in the region. In 2000,
the area increased to almost 315,000 hectares with the certification of three other enterprises:
Cikel and Juruá (both in Pará) and Gethal in the Amazon. In 2002, the certified area reached
481,000 hectares with the highlight being the appearance of the first community forest
management operation in Acre State. Two years later, the area almost quadrupled, reaching the
1.73 million hectare mark (Figure 2). The majority (75%) are natural forests, while 25% are
plantations. Beyond this, there is a significant number of forestry operations in the process of
being certified, which should not only greatly increase the area certified but also the number of
enterprises.

From a single pioneer enterprise in 1997 - Precious Woods - certification now, in 2004,
encompasses seventeen private companies and five community operations. The geographical
distribution of certification now includes the western part of the region (Acre and Rondonia
States), the central part made up by the Mato Grosso and Amazon and the Oriental Amazon in
the State of Pará. In terms of forest typology, it is divided into dense upland forest, open forest
and lowland forest.

209
Evolution of Brazil’s certified area

Figure 2: Evolution of certified area in the Amazon

2,000,00
1,800,00
1,600,00
Certified Area (ha)

1,400,00
1,200,00
1,000,00
800,00
600,00
400,00
200,00
0
1997 1998 1999 2000 2001 2002 2003 2004

Certification in the south and south-east of Brazil

Certification of plantations in the south and southeast of Brazil began with the certification of the
Rio Doce Forests in 1995. The following year, the forest areas of the Eucatex and Duratex
companies were certified. From then on, the certified area rose to reach 1.1 million hectares in
December 2004, which represents 20% of Brazil’s total plantation area. The large majority of
those plantations are planted with species of the Pinus sp and Eucalyptus sp. families.

The greatest growth in plantation certification took place in the wood-based panel, sawn wood
and pulp and paper sector. However, interest in certification has grown in other sectors such as
planted land for charcoal production. For example, the interest of companies in exporting
charcoal for the European market led to the certification of the Plantar and Mannesmann
companies.

The certified plantations of the south and southeast of the country are found in areas belonging
to the Atlantic Forest, a biome under extreme threat with only 7% of its original forest still
standing. Those plantations play an important role in the conservation of remnants of this type
of forest. The Klabin areas in Paraná are an example of the role of certified plantations. Of the
230,000 or so hectares certified under the company’s responsibility, 85,000 hectares are native
areas of the Atlantic Forest. Part of that Klabin Atlantic Forest area is managed in order to
extract non-timber forest products that are used in the manufacture of cosmetics and
phytotherapies, constituting the first global cases of FSC certification for those products.
Moreover, in the forest plantations of other companies, between 20 and 30% of the certified
area is made up of native forests as part of the FSC’s legal requirements and norms.

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Adalberto Veríssimo / Roberto Smeraldi / Tasso Azevedo

Klabin’s certification in 1998 was an important landmark in FSC history as it was the first
instance of a pulp and paper industry having been granted endorsement in the South. Klabin’s
certification involved an intense process of public consultation during pre-evaluation, which later
came to be a norm in the FSC scheme. The certification catalysed the timber supply for other
companies in the south of the country, which in turn increased the interest of those enterprises
in chain of custody certification. The result was a vigorous growth in chains of custody from just
five in 1998 to 132 in 2004.

The role of the buyers’ group

The Group of Buyers of Certified Forest Products was formed in April 2000 as an initiative by
companies who resolved to create a demand for certified products on the domestic market and
to lend profile and scale to that demand with the aim of encouraging producers to increase
supply in this market.

The initiative was based on the observation that raw material and certified products (at the
outset only timber-based) were extremely scarce and in the few cases where they did exist, they
were destined almost exclusively for foreign buyers. Some pioneering companies, such as
Tok&Stok, had tried without much success to develop a supply chain for certain products. A
certain frustration characterised both the big companies and a few vanguard designers who
approached certification.

The group came into being under the administration of the Amigos da Terra, Friends of the
Earth - Brazilian Amazon, an environmental body active in the forest sector since 1989 and
focused on promoting the sustainability of economic activities. From the start, Friends of the
Earth encouraged the members to take into consideration, the option and viability of
transforming the group into an independent business association. This process has not been
concretised yet but the current work plan is aimed at achieving the aforesaid conditions in the
first half of 2006. Over the years, the group acted as facilitator for business relations, source of
information on market trends, awareness-raiser of the final consumer and even as go-between
in the relations between Brazilian producers and beneficiaries on the one side and the foreign
firms on the other. For this reason the group has, since its initiation, been part of the Global
Forests and Trade Network (GFTN) managed by World Wide Fund for Nature (WWF)
International, which includes groups of producers and buyers in approximately 20 countries.

When the buyers’ group was created, the parcel of certified wood that supplied the domestic
market was very small in the planted sector and negligible in the native sector. In total, a mere
28 chains of custody existed in Brazil, only two of which were native forest. Then, in the first two
years of the group’s existence, the number of national chains of custody grew significantly,
initiating a trend of progressive growth. By December 2004, 169 chains of custody were already
in existence, more than a quarter of which were linked to products from native forests. Also in
2004, the first 4 national chains of custody were set up for non-timber products.

Today, the group, which has 64 members (still prevalently from the furniture sector), is trying to
reach ambitious targets such as expanding its membership to the civil construction, corporate

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The role of the buyers’ group

purchasing and non-timber forest products sectors, launching a campaign to promote the FSC
Trademark and improving its marketing services with a dedicated team.

The role of the Brazilian Amazon producers’ group

Half way through 2002, several certified timber companies, Cikel and Gethal in particular, began
to show an interest in setting up an association which would unite the certified enterprises of the
Amazon. The incentives behind this were fourfold.

Firstly, in 2002 the Brasilian Institute for Environment and Renewable Natural Resources
(IBAMA) imposed a million-figure fine upon two certified companies in the Amazonas State.
That event had negative repercussions in the national media. The reasons for the fine were
amply disputed by the companies, who saw in this incident a possible attempt to tarnish the
reputation of forest certification. This episode exposed the need for companies to join together
to protect their image and, by extension, the credibility of the FSC label itself.

Next, the companies thought it essential to expand the supply of certified wood to consolidate
the FSC label and the market for certified wood originating from the Amazon. The fear was that
the steep increase in demand, in the context of a limited supply of certified wood, might unleash
a crisis in the market, which could lead to the demand for wood with other labels. Therefore, the
expansion of the supply of FSC- certified wood, through increasing the area certified, was
crucial to the strategy to promote this new market.

Thirdly, it was necessary for the certified companies to differentiate themselves from the rest of
the timber sector in order for this segment to have political power and legitimacy: a crucial factor
considering the prospects raised by the Lula Government (2003 onwards) of support for forest
management. In fact, the forestry policies announced by the new government, such as the
drafting of the forestry concession bill, lines of credit and revision of management norms,
signalled the need for strong participation of the certified segment.

Finally, the certified companies agreed on the need to establish an area of technical
cooperation and a minimum research agenda in order to perfect certified forestry management.
In fact, the companies realised that, though they may compete with each other, it is vital to act
collectively in areas of common interest.

As a result of this convergence of interests, the companies and some certified communities
decided - at the beginning of 2003 - to set up the Amazon group of certified forest producers,
the acronym for which became PFCA (Produtores Florestais Certificados de Amazônia). In this,
the group asked for the support of Imazon, a Think and Do Tank, whose mission is to support
sustainable development in the Amazon. The group was formally launched at a large
conference (650 participants) on forest management and certification in Belém on 17 June
2003. The Environment Minister, Marina Silva, and the Minister for National Integration, Ciro
Gomes, attended the event. The conference also marked the approval of the first bank loans for
certified enterprises in the Amazon.

At the time of its launch, the PFCA had eight members (five companies and three traditional
communities) and a combined certified area of 330,000 hectares. At the end of 2004, the group

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Adalberto Veríssimo / Roberto Smeraldi / Tasso Azevedo

had twelve associates and a certified area of 1.5 million hectares, or 87% of certified area in the
Amazon (Table 2).

By December 2004, the PFCA was already consolidated with its statutes - focusing on
membership criteria and code of practice -, directorate and an elected and appointed fiscal
council. The budget secured from member company contributions - communities are exempt -
besides donations, enabled the renting of office space and the employment of an executive
secretary. In addition, the PFCA has fully operational working groups, with a particular focus on
groups in the operational and commercial area.

Imazon’s role was to catalyse the initiative, creating an environment of trust between the
companies and communities and assisting with the group’s strategic planning. Beyond that,
Imazon organised the drafting of the code of practice and institutional relations with other
NGOs, the Group of Buyers of Certified Forest Products and the federal government. Finally,
Imazon adopted the principle of delegating control of the group, from the outset, to its members,
both business and community.

Table 3: Certified enterprises associated to the PFCA at December 2004

Forest undertaking Certified area
State
(hectares)
Apruma Association 800 Acre
Cikel Brasil Verde 248,899 Pará
Porto Dias Community 4,209 Acre
Gethal Amazonas 40,862 Amazonas
Ecolog 22,132 Rondônia
Emapa 12,000 Pará
Juruá Forestry 37,000 Pará
Madevale 4,923 Rondônia
Orsa Forestry 545,335 Pará
Orsa Plantations 440,000 Pará
Precious Woods Amazon 122,729 Amazonas
Precious Woods Pará 76,390 Pará
Seringal Cachoeira 1,900 Acre
Total area represented by PFCA 1,557,179 -

Popularising the FSC in Brazil

In 1998, Friends of the Earth, Imazon and Imaflora established the Alliance for the Consumption
of Certified Forest Products. However, as a result of the scarcity of certified products on the
retail market, the Alliance’s work concentrated mainly on initiatives for the intermediate markets
between the producer and the wholesaler. For example, the study „Hitting the Target 2”
(SOBRAL et al. 2002) examined the issue of the Sao Paulo market, the main market in Brazil
and in the world for tropical woods, categorising consumption according to timber yards, civil

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Popularising the FSC in Brazil

construction and the furniture industry. The study enabled the establishment of an initial
dialogue with these sectors. As of 2004 - with the increase in domestic chains of custody and
the greater availability of raw material - several initiatives were launched directly targeted at
influencing the final consumer.

The first initiative of this kind was the „Certified Brazil” trade fair held in Sao Paulo in April 2004
and coordinated by Imaflora. The event boasted 50 exhibitors, more than 100 foreign buyers
and almost 4,200 visitors. The exhibition was a landmark in FSC history and was even attended
by the Environment Minister, Marina Silva, Acre governor Jorge Viana and the Executive
Director of FSC International, Heiko Liedeker. The trade fair showed that Brazil has the potential
to become one of the main sources of FSC products in the world. The event even hosted
workshops on the market for certified forest products and non-timber forest products, corporate
social responsibility, certified panels in the furniture and construction industries, and eco-design.
The exhibition offered a venue for making business contacts and holding business meetings
between exhibiting companies and visitors.

On the basis of this first experience, two new significant initiatives are planned for 2005. The
first, the „Forest Fair”, will take place in Sao Paulo. The aim of the event is to showcase to the
domestic and international public the enormous potential of the Brazilian forests in relation to
inputs for the cosmetics, pharmaceutical, graphics, food, tourism, furniture, civil construction
and decoration industries, besides wholesaler and retailer networks. Organised under the
coordination of Friends of the Earth, and once again in partnership with Imazon and Imaflora,
the event is presented as „a veritable forest supermarket with Brazilian charm and international
appeal”. There will be individual stands or specialised themes on products and services such as
fruit, nuts, palm hearts, spices, fish, wild honey, sweets, essences, fibres and vines, craft items,
native rubber, oils, soaps, creams, phytotherapies, tourism, biodiversity assets etc. All timber-
based products - furniture, charcoal, paper, cellulose, etc. - will be certified by the FSC, while
the other, non-timber products will be certified in part by the FSC or by other appropriate
schemes (such as agricultural certification, by Imaflora itself) or selected within the framework of
those that received support from the Friends of the Earth’s Sustainable Business Service. In the
second half of 2005, a campaign is also planned to promote the FSC trademark to the Brazilian
public at large, in the preparatory phase by one of the major advertising agencies in the country,
which should receive significant pro bono coverage in the national media.

Prospects and challenges

There is a prospect of rapid growth in certification in Brazil over the next few years. This growth
tends to be catalysed by the good business opportunities created by the exports of certified
products, in particular to the European Union (EU) and the United States of America (USA). On
the other hand, certification could experience slower growth in the coming years, especially in
the Amazon, if the structural issues of the Brazilian forest sector are not addressed. These
issues are different in the two regions of the country: Amazon and South-Southeast.

In the case of the Amazon, the main problem is the land tenure chaos, which inhibits the
expansion of the certified area. In fact, only 24% of the Amazon is made up of titled areas

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Forest certification in Brazil: advances, innovations and challenges
Adalberto Veríssimo / Roberto Smeraldi / Tasso Azevedo

whereas the unclaimed areas account for 45% of the territory. The remainder (31%) is made up
of Conservation Units and Indigenous lands (LENTINI et al. 2004). Brazilian law prohibits the
approval of management plans in unclaimed areas. Furthermore, the country does not yet have
a forestry concession law capable of permitting forest management in Sustainable Use
Conservation Units, such as in the case of the National Forests (VERISSIMO et al. 2002).
Therefore, the areas susceptible to management and certification are restricted to the private,
titled areas (24% of territory). The great majority of these areas, however, are deforested or
already constitute certified areas. As a result, FSC certification will only expand in the Amazon if
there is a forestry concession law permitting the management of protected or unclaimed areas.

In the South-Southeast, the private companies, particularly in the pulp and paper sector, are
investing in the modernisation of their industrial estate and the socio-environmental
improvement of their forest operations. Growth in FSC certification could take place mainly in
the segment of charcoal production for the iron and steel industry and in specific areas of the
pulp and paper sector.

Finally, several steps could prove decisive in guaranteeing the growth of the FSC in Brazil in the
next five years, in such a way as to enable certification to move from a special niche market
tendency (current situation) to one of market leadership. With this in view, the measures
identified below, coming from actors of civil society, industry and government, can be
considered decisive and potentially synergetic:
Increase the supply and diversity of certified products for the external market making Brazil
a global benchmark in FSC forest certification. This would attract support from public
economic policies, whose interest lies in expanding and securing an external market for
Brazilian products.
Substantially expand the demand, in the domestic market, for certification in the civil
construction sector, the main wood consumer in the Amazon.
Market the FSC-certified product to the consumer at large, generating constant demand in
all the sectors of the chain and not only in the furniture and exclusive design segments.
Create new market chains in the area of certified non-timber forest products, particularly in
those sectors where Brazilian production is experiencing strong growth and securing niches
in the global market, such as the cosmetic industry.
Define effective legal mechanisms for recognising certification in the tendering processes of
public bodies and state enterprises.
Implement public policies that would, by means of legal, tax and economic instruments,
drastically reduce wood originating from deforestation.
Approve and implement the forestry concession bill and establish an attractive forestry
concession scheme that would help overcome investor reluctance and insecurity mainly
with regard to the precariousness of the land tenure situation, particularly in the Amazon.

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Prospects and challenges

Acknowledgements

We are grateful to Marco Lentini (Imazon) and André Freitas (Imaflora) for their comments. We
are also grateful to Rodney Salomão (Imazon) for his collaboration in editing the map of
certification areas. A. Veríssimo was supported by the AVINA Foundation, the GTZ and the
Embassy of the Netherlands.

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References

FSC BRAZIL (2005): Florestas certificadas pelo FSC no Brasil (Forests certified by the FSC in
Brazil) (www.fsc.org.br). Access on 28/01/2004.

LELE, U. / VIANA, V. / VERISSIMO, A. / VOSTI, S. / PERKINS, K. / HUSAIN, S.A. (2000):
Brazil Forests in the Balance: Challenges of Conservation with Development. Evaluation
Country Case Study Series. Operations Evaluation Department. The World Bank, Washington
D.C. 195 p.

LENTINI, M. / VERISSIMO, A. / SOBRAL, L. (2004): Fatos Florestais da Amazônia 2003
(Amazon Forest Facts 2003), Belém: Imazon. 110p.

PNF (National Forestry Programme) (2004): Ministry of the Environment. Government of
Brazil.

SOBRAL, L. / VERISSIMO, A. / LIMA, E. / AZEVEDO, T. / SMERALDI, R. (2002): Acertando o
alvo 2: consumo de madeira Amazônica e certificação florestal no Estado de São Paulo (Hitting
the Target 2: Amazon timber consumption and forest certification in the State of Sao Paulo),
Belém: Imazon, Imaflora and Friends of the Earth. 74 p.

VERISSIMO, A. / COCHRANE, M. / SOUZA Jr., C. (2002): National Forest in the Amazon.
Science, (297) 1478.

217
Forest certification and development cooperation - an innovative partnership
Dietrich Burger

Forest certification and development cooperation - an innovative
partnership
Dietrich Burger

Introduction

Forest certification was often promoted in the tropics by „donors” in the context of development
cooperation (DC), although this was occasionally done in a paternalistic manner and without
adequate consideration of the existing conditions, which did not help either DC or certification,
let alone the target groups. Despite such regrettable events, however, forest certification and
development cooperation have a high and still largely unused potential for constructive and
innovative partnership.

A constructive partnership requires that the partners know their characteristics and take these
into account. Since certification has already been described in detail, the present paper
presents the goals and principles of DC, in order to examine whether and how certification can
help DC achieve its goals. Next, the question is reversed to ask how DC can support
certification. It is shown how a partnership between DC and forest certification can have an
innovative effect and boost the success for both sides, and when this happens. Further
development of this partnership is seen primarily as a communication problem.

Goals and principles of development cooperation

At the 1992 UN Conference on the Environment and Development (UNCED) in Rio de Janeiro,
178 countries agreed on the paradigm of sustainable development. In 1996 the German
Federal Ministry for Economic Cooperation and Development (BMZ) declared that the
paradigm of sustainable development was binding on all government development cooperation
(BMZ, 1996). The goal is accordingly to assist countries, regions, social groups or organisa-
tions to discover and be aware of their role as actors in sustainable development.

Three steps are required for this:
identification of the roles through reflection and negotiation between actors involved,
motivation and qualification of the actors for these roles,
creation or improvement of suitable environments (structures, guidelines) for role
perception.

Development cooperation accordingly covers a wide range of themes and sectors, with the
participation of very different state, private-sector and civil-society international, national and
local actors with a diversity of methods and very different goals, experiences and competences.

Development cooperation had been practised long before the Rio Conference, and was not
reinvented there. However, the paradigm of sustainable development agreed there outlined a
common basic understanding of development, and established a common basis legitima-

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Goals and principles of development cooperation

tion for actors from all cultures, religions and political systems and a common framework for
the diverse activities and goals of development cooperation.

Development is understood holistically, i.e. changes in the environment are just as much part
of development as economic and social changes. Because these three dimensions are
intimately linked and interact with each other, decisions on resources to be used and process
management and impact monitoring should always take environment, economy and society into
account jointly. Development is the result of the use of assets - the available resources. This,
however, requires taking all kinds of assets into account - environmental assets, economic
assets, social assets (i.e. human resources and social capital). If only one dimension of
indicators is considered in process management, e.g. economic, then undesired ecological or
social processes can easily develop without being noticed in time. The impacts of development
processes must be considered in all their dimensions, even if deliberate changes are made in
only one of these dimensions.

This holistic understanding of development inevitably leads to the insight that impacts of
measures to affect development can only be anticipated to a limited degree, that the impacts
must be carefully monitored and that measures must be modified if necessary, i.e. that
development must be managed not through rigid programmes, but as a learning process.
These learning processes must not restrict themselves to analysing short-term and artificially
simplified linear cause-effect relationships, but must consider the web of impacts of
development processes in their full complexity, including feedback and nonlinear processes.
Holistic understanding of development requires systemic and long-term consideration.

The precise goals which a country or society wishes to achieve in a specific time period cannot
be set once for all time, but have to be negotiated between those affected, taking into
consideration the context, and continuously reviewed and modified depending on progress.
External assistance within the framework of development cooperation can be helpful in this.

While it is not possible to derive precise development goals from the paradigm of sustainable
development, it is possible to determine the direction which development should take. In line
with the paradigm of sustainable development, it is regarded as legitimate (irrespective of
country or culture) to use environmental, economic and social resources in such a way that
future generations will have available resources offering them at least the same
development opportunities as the current generation (prudent use of resources);
the effectiveness of the resources used is as high as possible (efficiency),
benefits, opportunities and risks are equitably distributed between social groups (social
equity).

Development can be conceived and implemented in very different ways. However, the paradigm
of sustainable development agreed two common methodological features:
those affected are regarded as partners in development and included in the negotiation of
development goals and measures,

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development should be coherent at various levels (global, national, local, individual, family,
society), i.e. as free as possible from contradictions; sustainable development should be a
paradigm for individuals as well as for countries.

The paradigm of sustainable development is developed over 1,000 pages in the Rio
Documents. The brief presentation here in the form of
the holistic understanding of development covering environment, economy and society,
the three core statements on the direction (prudent use of resources, efficiency and social
equity),
and the two core statements on the procedure for sustainable development (partnership
and coherence).
was developed by an internal GTZ „Sustainability Working Group” in preparation for the 1998
Eschborn Dialogue, which was held under the motto „Reflecting on sustainable development”.
This brief form of the paradigm of sustainable development is intended as an easy-to-use
location tool if it is needed in DC to help partners in various countries and sectors find or
improve routes to sustainable development.

The common features in the basic understanding, basis for legitimation and methodological
framework created with the paradigm of sustainable development open up the possibility
internationally
of drawing up a regular balance sheet of progress (e.g. at the UN Conferences „Rio + 5“ in
1997 and Johannesburg in 2002),
of treating specific fields in special conferences (e.g. financing issues in Monterrey, 2001),
of setting priorities, e.g. MDG (Millennium Development Goals),
without replacing or losing sight of the comprehensive paradigm of sustainable development.

Besides the conceptual updating of DC through the orientation on the paradigm of sustainable
development, DC also needs to be continuously instrumentally modified and improved in the
interest of effectiveness. Currently, the German Federal Government is primarily following four
modernisation strategies in DC:
Greater influence on the framework conditions for sustainable development through
global structural policy (WIECZOREK-ZEUL 1999). Under this, global regulatory systems,
and specifically those for finance, trade and the environment, are to be further developed
guiding the relevant international organisations, e.g. World Bank (WB), International
Monetary Fund (IMF) World Trade Organization (WTO), and participating in international
conventions, e.g. the United Nations Framework Convention on Climate Change
(UNFCCC) or the Convention on Biological Diversity (CBD).
Establishing priorities in DC through 10 priority areas:
• democracy, civil society and public administration, human rights, and in particular
women's and children's rights, legal reform, decentralisation and municipal develop-
ment,

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Goals and principles of development cooperation

• peace development and crisis prevention,
• education,
• health, family planning, combating HIV/AIDS;
• drinking water, water management, wastewater and refuse disposal,
• food security, agriculture,
• environmental policy, conservation and sustainable use of natural resources (including
combating desertification, preserving soil fertility, sustainable forest management,
biodiversity),
• economic reform and development of the market system (including finance, trade
policy and private sector promotion, employment, vocational training, informal sector,
Small and Medium Enterprises (SMEs), industrial environmental protection),
• energy, and
• transport and communication (BMZ 2004a: 281 et seq.)
Geographical priority areas (BMZ 2004a: 282) through concentration on 70 cooperation
countries, i.e.
• „priority countries” with if possible at least 3 priority areas, and
• „partner countries” with if possible just one priority area
Bundling measures in programmes, if possible covering multiple sectors and institutions.

Development cooperation and the institutions involved in it are accordingly themselves in a
process of development. This cannot mean that concepts and instruments always have to be
developed from scratch, and the holistic understanding of development underlying sustainable
development in fact requires us to build on learning experience and incorporate the established
principles in the new concepts.

The following principles in particular have proved their value in technical cooperation (TC):
systemic approach (thinking in systems)
careful impact monitoring and
corrective modification (learning orientation) arise inevitably from the complexity of
development processes and the holistic understanding of development underlying the
paradigm of sustainable development Deutsche Gesellschaft für Technische
Zusammenarbeit (GTZ) GmbH, the major government-owned German TC organisation,
meets these needs through a combination of interdisciplinary technical competence and
intercultural regional competence, together with ongoing updating of the instruments for
impact orientation.
For many years, TC has operated on the principle of transferring ownership of
development in a country, sector or project to the key actors as soon and completely as
possible. To meet this requirement, TC supports:
• participation by those affected in decision-making processes and the equitable
distribution of benefits, costs and risks of development measures,

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• qualification of actors and modification of the environments so that actors in sustain-
able development can bring in their competences and fill their roles (capacity
development as a central task for technical cooperation),
• further development of sectoral, national and global forms of governance, i.e.
appropriate participation by state, civil society and private sector in management
responsibilities.

Development cooperation in the forest sector

Given the importance of forest management as a pillar of sustainable development, it seems
appropriate for forest management to be an important issue in international development policy
debate. At the UNCED „Rio Conference” forest management was covered in great detail in
chapter 11 of Agenda 21 and in the separate document on forest principles. To implement the
resolutions of the Rio Conference, the UN Commission for Sustainable Development (CSD)
created the Intergovernmental Panel on Forests (IPF) in 1995, which formulated 130 proposals
for action that were adopted in 1997 by the UN General Assembly as „Rio + 5”. They included
„the concept of National Forest Programmes (NFP) as a framework for orientation for
developing and implementing national forest policies”. In 1997 the Intergovernmental Forum on
Forests (IFF) was „created to press ahead with implementation of the IPF proposals for action
and resolve outstanding questions. By the last IFF meeting in February 2000, over 100 more
internationally agreed proposals for action had been adopted” (BMZ 2002: 26).

„In 2000 the UN Economic and Social Council (ECOSOC) created the United Nations Forum on
Forests (UNFF) and to assist this invited the secretariats of conventions and international
organisations relevant to forests to establish a Collaborative Partnership on Forests (CPF). The
two together form the International Arrangement on Forests (IAF). The removal of the forest
process from the Commission for Sustainable Development (CSD) to an autonomous UN
agency reflected the recognition by the international community of the importance of forests to
sustainable development” (BMZ 2004b: 13). This reported success does, however, stand in
crass contradiction to the fact that the financial volume of international development cooperation
(ODA, Official Development Assistance) for promoting sustainable forest management was
halved from USD 2,000-2,200 million at the start of the 1990s to USD 1,000-1,200 million in the
opening years of the third millennium (JENKINS et al. 2004).

In German forest related development cooperation, the annual financial volume of EUR 125
million called for by Parliament has been maintained. This means that „the German Federal
Government continues to be one of the biggest bilateral donors in the forest sector” (BMZ
2004b: 10). Currently BMZ is promoting some 170 forest projects in over 50 countries with a
(multiyear) total volume of over EUR 900 million. In addition, German forest-related
development cooperation is investing roughly half of this amount through multilateral or
intergovernmental organisations (cf. BMZ 2004b: 14).

The Sectoral Concept for Forest and Sustainable Development (BMZ 2002) is binding for
government DC, and provides German NGOs and the private sector with an orientation aid.
Three conceptual features of German forest DC seem particularly remarkable:

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Development cooperation in the forest sector

Sustainable forest management must be conceived and implemented on a multisectoral
basis. „As forest conservation and sustainable management are often seen as purely forest
issues rather than multisectoral ones, the importance of sustainable forest management for
the economy as a whole and other sectors is underestimated in many developing countries”
(BMZ 2004b: 8). Forestry measures must accordingly be integrated into multisectoral
programmes such as national forest programmes, and particularly also into national Poverty
Reduction Strategies (PRS). This is not only a planning but also a communicative task.
„Germany will continue to promote national forest programmes and assist partner countries
in making forests an issue for policy and not just considering them as an object for
planning” (BMZ 2004b: 47). While the multisectoral threat to the forests has long been
known, multisectoral approaches to forest conservation and sustainable management are
still in the early stages.
German forest DC will continue to follow the established „multilevel approach, i.e. it will
operate at several levels (international, regional, national, subnational, local), with
networked programmes and combine multisectoral planning with sectoral action” (BMZ
2004b: 13). There has been „particularly good experience with linking policy advisory
projects with field projects and preferably feeding concrete experience into policy
formulation” (BMZ 2004b:12).
„Ecological and social minimum standards (safeguards) are BMZ minimum
requirements for programme and project promotion and implementation, and will be
operationalised in stages in the cooperation countries” (BMZ 2002:13). „For all forms of
commercial forest management … certification under FSC or an equivalent standard for
socially and ecologically sustainable forest management must be sought” (BMZ 2004b: 11).

Forest certification as an innovative helper for development cooperation

The goals and principles of forest certification and those of development cooperation are
broadly coherent:
Both have support for sustainable development as their goal
Forest certification can be regarded as a textbook example of the systemic approach: the
added value chain is used in a sense as a lever for giving an entity (e.g. in Germany)
influence on forest management at a spot possibly thousands of kilometres away, with a
completely different culture and environment (e.g. Amazon region).
Regular impact monitoring and learning orientation are ensured in enterprise
certification with regular controls by the certifiers.
In certification, particularly under FSC, participation plays a central role both in formulating
the standards and in the process of certification.
The standards and regular meetings with the auditors create clear orientation for those
active in forest management, which contributes significantly to their qualification and
shows clearly in what direction further qualification is needed, including both technical
issues and also - and particularly - dealing with interest groups and affected persons.

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Formulation of standards in national working groups contributes significantly to capacity
development of the actors involved in both the technical area and communication and
negotiation skills.
Forest certification - particularly under FSC - with the participation of civil society and
private sector in regulatory functions in the forest sector plays a pioneering role in the
further development of governance in the forest sector at enterprise, subnational, national
and international level.
Forest certification can help in many ways to free forest management from sectoral
isolation and approach it in a multisectoral manner.
• The participation of those affected in standard setting for certifiable forest manage-
ment leads to consideration of the interrelationships between forest management and
other sectors (e.g. tourism, trade, industry) and increased awareness in other sectors
of the problems of forest management.
• The same goes for the participation by those affected and the general public in the
compliance verification process.
• In the framework of the implementation strategy for forest certification, representa-
tives of other sectors (e.g. banks, insurance companies) and consumers can be
informed of the advantages to them of forest management complying to the standards,
and be persuaded to support this.
• The PR work associated with forest certification can lead to consciousness raising and
corresponding political positioning among the general public for the concerns and
problems of sustainable forest management.
Forest certification necessarily implies a multilevel approach.
• The standards to be met are based on internationally agreed principles and criteria,
and are nationally (regionally) specified and locally applied.
• Actors at international, national and local level participate in forest certification and
collaborate on change processes at all these levels.
Forest certification ensures more effectively than any other instrument of forest-related DC
that ecological and social minimum requirements are met in DC projects.

Due to this high degree of coherence, forest certification can help DC in three ways:
1. Implementation aid for forest DC:
operational: forest certification offers enterprises converting to sustainable forest
management
• important orientation aids both through the standards to be complied with and the
control visits by the certifiers,
• economic incentives and
• credibility for the seriousness and binding nature of the intent to convert (enterprises
previously known for their exploitive operations will find it difficult to achieve credibility
without the communicative help of certification).

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for development cooperation

in the forest sector: forest certification initiates change processes which extend beyond
the certified enterprise:
• a new culture, a „participative culture“, for actors dealing with each other develops in
the sector.
• besides the state forest policy institutions, the private sector and civil society are
increasingly involved in regulation processes in the sector, new forms of governance
are practised; such forms of governance, e.g. national working groups, can be more
effective and efficient as starting points for change processes which DC is seeking to
promote in the forest policy sector than the current institution building of classic forestry
institutions.
• forest certification increases transparency in the forest sector in several ways:
- movements of products in the added value chain become trackable,
- products from legal sources become identifiable; with new legality, the sector’s
legitimacy also improves in the public eye,
- the quality of forest management in the certified enterprises becomes obvious,
including compliance with social, economic and ecological standards.
• The illustrative and instructive example of certified enterprises increases competence
in the sector, not least among the state offices.
• The labour market for qualified employees grows.
• Due to its structure-changing impacts, forest certification can contribute to an improved
environment for and increased effectiveness of other measures, e.g. in the field of
training.
• Forest certification as a change agent can prepare the sector for more extensive
change processes, e.g. entry into National Forest Programmes conceived and
propagated in the framework of the Rio follow-up process.

2. Help in changing multisectoral environments:

The changes promoted in the forest sector by forest certification, particularly in terms of
participation, governance, transparency and binding status, can have an effect beyond
the forest sector and improve the conditions for sustainable development in multiple
sectors.
Forest certification can particularly help to initiate a culture of sustainable development,
i.e. always considering the social and ecological aspects of development problems as well
as the economic aspects, bearing in mind the availability of resources for future
generations, using resources efficiently and also with social equity, understanding
development as a partnership process and striving for coherence from the local to global
levels. The importance of cultural factors as part of and a prerequisite for development is
increasingly being understood and addressed. The latest Human Development Report by
the UN Development Programme is entirely devoted to this issue, with the subtitle „Cultural
liberty in today’s diverse world” (UNDP 2004).

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3. Innovation help for DC itself:

The change processes supported by normal DC projects often stay within the limits of the
project area or expire at the end of the project. By contrast, the change processes initiated
by forest certification develop an autonomous dynamism because of the associated
incentives, resulting in their dissemination over time.
The bilateral DC of many countries is increasingly concentrating on specific priorities and
countries. However, this poses the risk that geographical or thematic gaps in DC will
develop. Promoting forest certification, particularly as a supraregional approach, offers the
opportunity of bridging these gaps and contributing towards promoting sustainable forest
management in countries which are outside the selected geographical priorities or where
forest management has not been selected as a thematic priority.

Opportunities and risks of supporting forest certification through development
cooperation

Development cooperation can support forest certification in various ways:
Financial and organisational: DC can assume costs either for enterprise certification or
for establishing a certification system in a country, e.g. costs of workshops, working groups
or studies. DC may also be able to provide organisational support through its network of
offices and projects, e.g. in searching for qualified personnel, organising conferences or
administration of measures.
Conceptual: Based on the long practical experience of DC in various sectors and regions,
DC can provide conceptual advice in establishing and developing national certification
systems, e.g. on questions of capacity development, participation and governance, impact
monitoring and sectoral technical questions, e.g. market studies or technical forestry
problems. DC can also support learning processes for conceptual further development
through pilot studies on new approaches to certification or impact analyses of existing
certification initiatives. Finally, DC can identify new potential for synergy and
cooperation through studies on interactions and complementarity with other (e.g. forest
policy) initiatives to promote sustainable development.
Political: DC participation in establishing and developing national certification initiatives
can significantly boost their status and acceptance by the public, and particularly by the
government and private sector. DC can also emphasise the significance of forest
certification as an instrument for implementing sustainable development in the framework of
political dialogue, e.g. in government negotiations on future cooperation, providing political
support. Finally, it is conceivable that DC could note in agreeing nonforest measures in
forest areas that functioning forest certification in this area can be interpreted as proof of
the seriousness of efforts towards sustainable forest use and sustainable development. DC
can also operate at international and intergovernmental level, e.g. in the negotiations of the
International Tropical Timber Organisation (ITTO) to emphasise the importance of forest
certification as an instrument of sustainable forest management and against trade in
illegally logged wood, and to stress the political priority of this instrument.

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Opportunities and risks of supporting forest
certification through development cooperation

Supporting partnerships: Possibly because of strong roots in emphatically confrontational
civil society organisations, it is often a laborious process for forest certification to attract
state organisations or the private sector as partners, although such partnerships would
seem natural to an outsider. Due to the generally close relationships between DC and
government agencies and growing cooperation with the private sector, DC can have a
bridging function between state, private sector and civil society and support
corresponding partnerships. Intermediation between state and certification initiatives
organised by civil society and the private sector can make better use of stimuli from
voluntary standards initiatives for institutionalising standards in a statutory framework.
Boosting demand: Finally, DC can emphasise the development policy importance of using
certified forest products to partner institutions in forest and nonforest projects. Procurement
policy of government institutions in particular can make a very significant contribution
towards the economic stabilisation of national certification systems.

Despite this wealth of possibilities for DC to support forest certification, it is important not to
forget that a commitment to forest certification by DC also involves considerable risks:
Risk of inadequate ownership: If the decision on forest certification is strongly influenced
by external donors, but merely tolerated by the target groups instead of being actively
supported, there is a risk that certification will be seen as serving foreign interests, and will
not be renewed when projects end, or that the promoted national working groups will shut
down. Subsequently, the target groups can also remain passive in other measures.
Risk of fragmenting social development: Certification, particularly if it is to be
implemented through marketing, requires decision-making structures and management
skills which can respond quickly and appropriately to developments in markets. This,
however, is often out of line with current working procedures and decision making
processes, e.g. in communal forest management. This can lead to failures by communal
forest management in the markets, or to disruptions of social relations and procedures.
Unfortunately, DC does not always take into account the social conditions for success of
certification.
Risk of excessive vertical integration: Certification can only be implemented in markets if
the entire added value chain is certified right through to the consumer’s supplier. If a forest
enterprise wants to sell certified raw wood, it often has problems finding Chain of Custody
(CoC)-certified sawmills. It is logical to integrate the next stage in processing into the
enterprise, and add a sawmill to forest management in the hope of increasing value added
in the enterprise. The easier the financing, the easier it is to take this decision. However,
because operating a sawmill involves entirely different requirements in terms of technical
knowledge and management capability than forestry, the attached sawmill can easily cause
greater losses than the added value from certification of forest management. The loss is
easily but unjustly attributed to certification.
Risk of inaccessibility of markets which welcome certification: Not every forest
enterprise is able to access markets which welcome certification, either because of lack of
transport links, quantities supplied or market links. In such cases, it is very risky to
implement certification through marketing.

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Risk of inadequate qualities: The potential to create added value through certification,
although undoubtedly present in many areas, can only be realised if the supplied products
meet other quality requirements in addition to certification, specifically in terms of
processing and grading quality and reliable delivery.

Outlook

Forest certification is certainly not a simple panacea which could guarantee that forest
management makes its potential contribution to sustainable development. However, if
approached properly in a given situation, a partnership between forest certification and
development cooperation can make an important contribution to this goal This cooperation can
be innovative for both partners by developing new role understanding, cooperation partnerships
and possibilities for impact.

Realising the potential of this partnership is primarily a communication problem. Actors in forest
certification and DC pay little attention to each other, communicate little and often in a language
which is difficult for the other side to understand. In many cases, prejudices are clung to which
make it difficult to realise that the „other side” is working towards the same goals and with
entirely coherent principles. Conversely, development cooperation and forest certification have
already made a start at various points on very fruitful cooperation in partnership. The present
publication will hopefully contribute to the further development of this partnership in the interests
of sustainable development.

229
References

References

BMZ (1996): Entwicklungspolitische Konzeption des BMZ, Bonn.

BMZ (2002): Sektorkonzept Wald und nachhaltige Entwicklung. BMZ Konzepte Nr. 121, Bonn.

BMZ (2004a): Medienhandbuch Entwicklungspolitik 2004/2005. Berlin.

BMZ (2004b): Fortschrittsbericht zur deutschen Bilateralen Entwicklungszusammenarbeit im
Waldsektor. Unterrichtung durch die Bundesregierung. Deutscher Bundestag, Drucksache
15/4600, Berlin.

JENKINS, M. / SCHERR, S. J. / INBAR, M. (2004): Markets for Biodiversity Services. Potential
Roles and Challenges. Environment, 46/8:32-42.

UNDP (2004): Bericht über die menschliche Entwicklung 2004. Kulturelle Freiheit in unserer
Welt der Vielfalt. Deutsche Gesellschaft für die Vereinten Nationen e.V., Berlin.

WIECZOREK-ZEUL, H. (1999): Nachhaltige Entwicklung durch Globale Strukturpolitik. UN
3/199, 100-103.

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About the authors
About the authors

About the authors

Nina Bressel
Since 2000 Nina Bressel has been studying Politics, Law and Economics at Darmstadt
University of Technology, Germany. Since 2001 she has been assisting at the Chair for
International Relations under Prof. Dr. Klaus Dieter Wolf.

Dietrich Burger
Dietrich Burger studied Forest Sciences in Freiburg, Munich and Oxford and obtained a PhD
from the University of Freiburg. From 1968-72 he worked as a civil servant in the State Forest
Authority of Baden-Württemberg. From 1972-81 he lectured Forest Management at the
University of Curitiba, Brazil. In 1982-83 he attended an MSc course in Agricultural Sciences in
the Tropics, at the University of Göttingen. In 1983-87 he coordinated the EMBRAPA-GTZ
research project, in Belém, Brazil. From 1987 to 2004 he filled the following positions at GTZ
headquarters in Eschborn: Project Manager, Head of Division of Forest Management and
Conservation of Nature, Project Manager of the GTZ Forest Certification Project, Director of the
Programme for Social and Ecological Standards. As of 2004, and in an honorary capacity, he
became a GTZ senior adviser for sustainable development and professor at the University of
Freiburg.

Ronnie De CAMINO Velozo
Forester and Economist, University of Chile. Dr. rer.nat. University of Freiburg. Currently
Professor at the University for Peace, United Nations. Formerly Professor of the Graduate
System of CATIE and Invited Professor of the Technological Institute of Costa Rica and of
CIDIAT in Venezuela. Founding Member of the Board of Trustees of CIFOR and Former
Member of the Board of the TROPENBOS Foundation. Former Chief Forestry Officer of
Precious Woods and Research and Planning Manager of CONARE, the Venezuelan
Reforestation Company. Consultant for many bilateral and multilateral agencies, with
experience in most of the Latin American Countries in the areas of forest management, natural
resources policies, sustainable development and community management of natural resources.

Chew Lye Teng
Bachelor of Science (Honours) from Universiti Malaya and a Masters in Business Administration
from the International Management Centres Multinational, Buckingham, United Kingdom.
Currently he is Chief Executive Officer of the Malaysian Timber Certification Council, Malaysia
(MTCC). In this capacity, he coordinates the implementation of MTCC’s activities that include
the facilitation of standard setting processes for forest management and chain-of-custody
certification; implementation and monitoring of the operation of the certification scheme;
coordination with national, regional and international bodies related to timber certification to
facilitate cooperation and mutual recognition arrangements; and administration of the day-to-
day running of MTCC. Prior to this, Mr. Chew was attached to the Malaysian Timber Industry

233
About the authors

Board (MTIB) from 1974 to 1998 where he served in various capacities, including Director of the
Technical Services Division as well as the Development Division.

Chris Elliott
Director of WWF's International Forests For Life Programme. Chris Elliott has a Doctorate in
Forest Policy from the Swiss Federal Institute of Technology, Lausanne and a Masters degree
from the Yale School of Forestry and Environmental Studies. He has been involved in
international forest conservation for over fifteen years and has worked on the ground in
Indonesia, Ecuador, Cameroon, Canada and Sweden. He was the first chairman of the board of
the Forest Stewardship Council and has published and taught extensively on the subject of
forest certification, including a period as guest professor at the agricultural University of Vienna,
Austria.

Ben Gunneberg
BScFor, MICFor, MBA, a graduate from Aberdeen University, a chartered forester and a
business graduate from the Open University, he has spent most of his working life in Forestry.
His career started as a forestry contractor and after university he worked as a researcher at the
University of Wales, Bangor in Forest Economics. Thereafter he worked for the Timber Growers
Association in the UK in various posts covering all technical and policy aspects of forestry. As
Technical Director he became actively involved in the development of forest certification
schemes and became the PEFC Council’s Secretary General at its inauguration in Paris in June
1999. In 2000 he relocated to Luxembourg to set up the PEFC Council’s international headquar-
ters.

Pierre Hauselmann
Pierre Hauselmann has a Masters Degree in Environmental Management. He has been
involved in standardisation and certification for more than 10 years and participated as technical
expert in several standardisation processes, including the drafting of the ISO 14000 series of
standards on environmental management. He has a broad expertise in multi-stakeholder
processes for standard setting and has directly contributed to the policy, strategic and
institutional development work of several environmental and social certification schemes. He is
a founding member of the Forest Stewardship Council. He has advised NGOs, governmental
and intergovernmental organizations, the private sector on issues related to trade and the
environment, standardisation, certification and labelling. In 1995 he founded Pi Environmental
Consulting, the company in which he is a partner.

Jürgen Hess
Coordinator of the Forest Certification Component within the Programme for Social and
Ecological Standards at Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ). He has
a Doctoral Degree in Forestry from the University of Technology of Dresden. From 1997 to 2000
he worked for GTZ in Laos as Advisor for Forestry Education, Research and Organizational
Development. In 2000 he changed to Cambodia and until 2003 worked for GTZ as a Forest

234
About the authors

Policy Advisor to the Ministry of Agriculture, Forestry and Fisheries supporting the Government
of Cambodia in the design and implementation of a National Forest Programme (nfp).

Alexander Hinrichs
Free-lance expert in international forest management. Alexander Hinrichs is an external advisor
to the GTZ Programme for Social and Ecological Standards where he is responsible for
coordinating all programme activities relevant to certification in Asia. Furthermore, he advises
the ASEAN certification initiative and is actively engaged in development cooperation
throughout all of Southeast Asia as well as in China. Between 1996 and 2002, he worked for
GTZ as deputy team leader for the „Indonesian-German Sustainable Forest Management
Project“ in East Kalimantan. During this period, he worked with many different stakeholders,
including the private sector. He has been accompanying the development of LEI since 1997
inter alia facilitating its meetings with the FSC. Prior to his work in Indonesia, he was an
academic lecturer and management consultant.

Barbara Lang
Project Officer in the Programme Office for Social and Ecological Standards at Deutsche
Gesellschaft für Technische Zusammenarbeit (GTZ). She has a Masters Degree in Forestry and
a B.A. in Modern History, both from Oxford University. From 1998 to 2004 Barbara worked for
the GTZ Forest Certification Project, from mid-2003 as its Coordinator (the project became an
integral part of the Programme for Social and Ecological Standards in 2001). Prior to joining
GTZ she worked for the FSC UK Working Group. As an individual member of the FSC she has
been involved in the work of the German FSC Working Group from its beginning (1998) and is
presently a member of its steering committee.

Heiko Liedeker
Executive Director of the Forest Stewardship Council. Prior to this appointment in 2001 he
served as Chairman of the WWF’s (World Wide Fund for Nature) European Forest Team and
also director of WWF’s European Certification Initiative. He is the former head of WWF
Germany’s Forestry Department and a former Board member of the FSC Germany Working
Group. He was a senior consultant to the Kingdom of Saudi Arabia for 3 years and advised on
the application of environmental information systems. He has also served as an expert at the
University of Bucharest in Romania. Mr. Liedeker holds a Masters degree in Forest Ecology
from the University of Vermont, USA and an undergraduate degree in Forestry from the Ludwig-
Maximilian University in Munich, Germany during which time he also studied at the University of
New Brunswick, Canada.

Tasso Rezende de Azevedo
Graduated in Forestry from the „Luiz de Queiroz” School of Agriculture, University of São Paulo,
1994. Specialised in Forestry Policy (Oxford University, England, 1997), Forest Certification
(Orgut - Upsala, Sweden, 1998), Forest Auditing (Chetumal, Mexico, 1995). He was a Research
Associate with the IPEF (Forest Studies and Research Institute) in 1995, the year in which he

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About the authors

also co-founded IMAFLORA (Institute of Forestry and Agricultural Management and
Certification) of which he was Executive Chairman until 2002. Between 1997-99 he was Co-
coordinator of the Working Group on Non-Timber Forest Products of the Global Forest
Stewardship Council (FSC). He has been the leader of the AVINA Foundation since 2003. At
the beginning of 2003 he was made manager of Sustainable Use of Forest Resources,
Secretariat of Biodiversity and Forests, Ministry of the Environment, becoming Director of the
National Forest Programme in November of the same year. Leading Auditor and Senior
Instructor for Forest Certification. He has around 35 publications on certification, forest
management and forestry policy.

Oliver Scholz
Graduate Forester. He started his forestry career working in various posts in the German State
Forest Service of the State of Hessen. Thereafter he was a researcher at the University in
Göttingen. Until recently he was a technical expert for the Confederation of German Forest
Owners Associations in Berlin covering economical, technical and policy aspects of forestry. In
this position he was actively involved with a wide variety of international processes relating to
forestry. Oliver Scholz joined PEFC Council in Luxembourg in 2004 as its Communications
Manager.

Harnarinder Singh
Bachelor of Science (Forestry) from Universiti Pertanian Malaysia (UPM) and a Master in
Philosophy (M.Phil.) in Forest Economics from University of Wales, Bangor, United Kingdom.
Currently he is Senior Manager of the Malaysian Timber Certification Council, Malaysia
(MTCC). In this capacity, his duties include the formulation of policies and strategies in the
planning and development of the MTCC scheme; coordination of consultations and discussions
with stakeholder groups for the development of certification standards for forest management
and chain-of-custody; preparation, implementation and evaluation of publicity and promotion
programmes on MTCC; liaising closely with MTCC’s clients, local stakeholders, local and
foreign mass media organisations, and all other interested parties; and management of MTCC’s
participation in international exhibitions and fairs. Prior to this, Mr. Harnarinder was attached to
the Forestry Department Peninsular Malaysia from 1980 to 2000 where he served in various
capacities in the Forest Plantation Unit, Silviculture Unit, and Pahang State Forestry Department
in charge of forest planning and inventory.

Roberto Smeraldi
Journalist and Director of Friends of the Earth - Brazilian Amazon. Author of studies and books
on public policies, sustainable development and the environment. Between 1989 and 1992 he
was President of the International Committee of NGOs for the United Nations Conference on
Environment and Development. Since 2003, he has presided over the International Advisory
Group of the Pilot Programme for the Protection of Brazil’s Forests, an advisory body to the
federal government and the World Bank, of which he has been a member since 1996. He is a
member of the Brazilian Forum on Climate Change, presided over by the President of the
Republic, as well as of various consultative bodies of the federal government. He is a member

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About the authors

of several councils of foundations and environmental institutions, such as Yale University’s
„Forest Dialogue”.

Michael Spencer
Head of Marketing and Communication, Forest Stewardship Council (FSC), Bonn, Germany.
Michael Spencer was engaged by the FSC in July 2003 to develop strategic marketing and
communications programmes for the FSC global network. This work includes: Enhancing the
value of the FSC brand through strengthening its market presence, simplifying its promise and
protecting its integrity; Identifying potential revenue generating opportunities that could
consolidate longer term financial stability of FSC, and; Leading the development of
communication initiatives to strengthen the relationships between FSC and non-government
organisations, corporations and governments as well as consumers of forest products.
Prior to joining FSC, Michael spent almost 10 years in the corporate sector as; Group Manager
Corporate Citizenship at the National Australia Bank, Vice President Communication at BHP
Billiton and Head of Communication and Corporate Marketing at BHP. He has worked in
consulting as General Manager of the National Institute of Economic and Industry Research
(Australia) and in government as a senior advisor to the Premier of Victoria (Australia) and
media advisor to a number of ministers in the Victorian Government. Michael holds a BA in
politics and economics and a Graduate Diploma in Public Policy from the University of
Melbourne and, a Graduate Certificate in Management from the Australian Graduate School of
Management.

Nancy Vallejo
Lawyer with a Masters Degree in Ecosystem Management. Since 1999, Nancy Vallejo has been
a partner at Pi Environmental Consulting, where she has been involved in policy and strategic
issues, and field work related to trade and environment, corporate social responsibility,
standardisation, certification and labelling, social and environmental effectiveness of market
mechanisms, legal and institutional development, capacity building and training. She has been
active with different environmental and social certification initiatives, with a special interest in
strengthening their capacity to deliver in developing countries, particularly for SMEs. Prior to Pi
Nancy had performed the roles of General Secretary of the Colombian Environmental Protection
Agency and Senior International Treaties Co-ordinator of WWF International, focusing on the
Convention of Biological Diversity and its implementation in key developing countries.

Adalberto Veríssimo
Agronomist, with a Post-graduate Degree in Ecology from Pennsylvania State University (USA).
Co-founder and currently Senior Researcher of the Amazon Institute of People and the
Environment (Imazon) and Leader of the AVINA Foundation since 2002. Author of 14 books
and dozens of scientific articles on ecology, biodiversity, forestry management and natural
resources policy in the Amazon. Member of the executive board of Imaflor (Institute of Forestry
and Agricultural Management and Certification) and member of the technical committee of the
ARPA Project (Protected Areas Project), whose mission is to significantly expand the

237
About the authors

Conservation Units of Integral Protection in the Brazilian Amazon. Consultant for various
organisations such as the World Bank, Ministry of the Environment, FAO and the Deutsche
Gesellschaft für Technische Zusammenarbeit (GTZ).

Klaus Dieter Wolf
Since 1992 full professor, Chair for International Relations, Institute of Political Science,
Darmstadt University of Technology. He has been President of the German Political Science
Association (DVPW) since 2003, and written numerous publications on international institutions,
the problems of cross-border governance and theories of international relations.

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