Forest firms go for gold stars
Posted on Sunday, April 16, 2006
Proxy season 2006 is in full swing and forest-certification questions are on the ballots of three large forest-products companies, all with operations in Arkansas.
Forest certification systems, like “organically grown” stickers on produce, serve as a seal of approval. They are a way to hold companies publicly accountable for management practices in the forests, which provide the wood and paper for the products the companies sell.
Shareholders of Weyerhaeuser Co., Kimberly-Clark Corp. and International Paper Co. are being asked whether they think Sustainable Forestry Initiative, or SFI, standards are sufficient. Some owners of stock in these companies have their doubts, so they filed proxy resolutions asking that the companies study the feasibility of certifying their timberlands and production facilities under different standards set by the Forest Stewardship Council, or FSC.
“We think of Weyerhaeuser as a leader,” said Stu Dalheim, manager of advocacy and policy for Bethesda, Md.-based Calvert Asset Management Co. Inc., an investment firm that specializes in funds that are “socially responsible” in areas such as the environment, human rights, and corporate governance. “It should remain a leader” by adopting FSC, “the leading-edge certification system,” he said.
But Weyerhaeuser already adheres to SFI standards, said Cassie Phillips, Weyerhaeuser’s vice president of sustainable forests and products.
“Some companies are doing dual certification... but we don’t see the value justifying the extra cost,” Phillips said.
To understand this difference of opinion, it’s important to understand the genesis of forest certification, said Ben Cashore, director of the program on forest certification at Yale University’s School of Forestry and Environmental Studies in New Haven, Conn. Large-scale certification schemes only began taking shape after the 1992 Earth Summit in Brazil, he said.
The global FSC scheme, created largely by environmentalists, was one of the first attempts to codify forest-management standards. Now based in Bonn, Germany, FSC is overseen by a general assembly composed of three chambers — social, environmental and economic — and a nine-member board of directors.
“Industry across the world responded by creating FSCcompetitor programs,” such as SFI in the United States and Canada, Cashore said, and a “competition for legitimacy” has ensued.
Originally created by the American Forest and Paper Association, SFI is a prerequisite for membership in that Washington-based industry trade group. Since 2002, the SFI standards have been controlled by the Sustainable Forestry Board, an Arlington, Va.-based nonprofit.
The board has 15 members, five each from three areas of interest: environmental, economic and other involved parties such as small landowners.
Among the economic members are John Faraci, chairman and chief executive officer of International Paper, and Steven Rogel, chairman, president and chief executive officer of Weyerhaeuser.
To date, FSC has certified 182 million acres of forestland worldwide, 22. 5 million of those acres in the United States. SFI has certified a total of 131 million acres of forestland, 83 million acres in Canada and 48 million in the United States.
Although the two standards are complex — addressing issues such as chemical use, clear-cutting, endangered species, forest roads, reforestation, single-species plantations, water quality and worker training — their goals are simple, said Mark Evertz, communications manager for Metafore, a nonprofit environmental business consulting group based in Portland, Ore.
“Certification is a means to an end, and that end is sustainable forestry,” Evertz said.
“Basically all businesses, in our view, are in the forest business,” he said. “If we can get businesses to buy, use and produce materials in an environmentally and socially friendly fashion, then ultimately we’ve achieved our goal as an organization, which is to make sure that forests are around now and until the end of time.” Metafore endorses no single forest-certification scheme, but many environmental advocacy groups like ForestEthics are solidly in favor of FSC.
“We believe that the Forest Stewardship Council is the only credible and sufficiently environmentally protective certification system in existence,” said Daniel Hall, a U. S. spokesman for the Canada-based group.
Other environmental advocacy groups, like the Dogwood Alliance in Asheville, N. C., are quick to criticize SFI.
“We typically see the SFI as basically a rubber-stamp program, because many of the things we’d like to see change within forestry are still certified under the SFI,” said Scot Quaranda, Dogwood’s communications director.
CONVERGENCE Over time, many of the differences between FSC and SFI have diminished. The growing popularity of FSC certification in the United States, for example, has kept FSC busy, said Michael Washburn, vice president for brand management at FSC’s U. S. affiliate. Unlike many other countries, small landowners own more than half of all U. S. timberland, so FSC has responded by developing a “family forest program” and a “resource manager certificate” to facilitate their certification, Washburn said. “Our obligation is to make the tool user-friendly and costeffective,” he said, without “weakening the standards so that the brand loses integrity.” Meanwhile, Bill Banzhaf, who serves as president of the Sustainable Forestry Board, supervised the release last year of an updated set of SFI standards that will govern the program through 2009. The new standards have upgraded SFI’s auditing requirements and strengthened the requirements regarding plantations and international wood procurement, Banzhaf said.
“The two systems are pushing each other to be better all the time,” he said.
Cashore agrees. “The dialogue that’s emerged from all this conflict and debate has actually been really positive,” and each system has learned from the other, he said. FSC, for example, now certifies responsible tree plantations, and SFI recognizes that harvesting in “old growth” or “high conservation value forests” should be strictly controlled, Cashore said.
“There’s definitely a convergence happening, but that’s not the same as being the same,” he said.
One U. S. forest-products company couldn’t agree more. Potlatch Corp. decided that dual certification — under FSC and SFI — would be one way to differentiate itself from its competitors, said John Olson, the company’s vice president for resource, log marketing and land development, based in Lewiston, Idaho.
In 2002 Potlatch agreed to conduct a side-by-side evaluation of the two certification systems for the Pinchot Institute for Conservation, Olson said.
“We came away from this dual assessment believing that having both certifications was better than having either one alone,” he said. “From a purely forest-sustainability standpoint, we felt both standards go a long way to getting you there,” but each system has particular strengths. By 2005, all of Potlatch’s timberland — in Arkansas, Idaho, Minnesota and Oregon — was FSC certified, and most of its mills had been awarded “chainof-custody” certification.
SUPPLY CHAIN LINKAGES “Think of ‘chain-of-custody’ as an inventory management system that allows the end product to carry the FSC label,” said Liza Murphy, a forest-products marketer for the Rainforest Alliance, a New York-based environmental nonprofit, whose SmartWood subsidiary served as Potlatch’s FSC auditor.
The challenge for companies like Potlatch is creating and building market demand for their FSC-certified products, Murphy said. A number of retail outlets — FedEx, Kinko’s, Staples, Home Depot and Lowe’s — already have made commitments to stock FSC-certified products.
Another source of demand is the U. S. Green Building Council’s Leadership in Energy and Environmental Design, or LEED, a program for commercial building standards. Under LEED’s point system, “the only way that you can accrue points for wood use is to use FSCcertified wood,” Murphy said. The competing environmental assessment system known as Green Globes recognizes FSCand SFI-certified wood.
Many companies, like Montreal-based Domtar Inc., have made a commitment to move toward FSC certification. The company’s Arkansas mill, for example, has an FSC chain-of-custody certificate but has not yet begun producing any of Domtar’s FSC-certified EarthChoice line of paper products, said Max Braswell, a spokesman for the Ashdown mill.
Several major corporations, including Bentonville-based Wal-Mart Stores Inc., are printing their 2006 annual reports on EarthChoice paper.
FEEDBACK:
Something to say about this topic? Submit a Letter to the Editor online
