IN 1989 TIME MAGAZINE CALLED THE DESTRUCTION OF THE AMAZON rain forest “one of the great tragedies of human history” (Linden 1989). The Amazon was burning, in large part to clear forested land for agricultural plantations and cattle ranching. Brazilian labor and environmental activist Chico Mendes had just been assassinated, and international observers were becoming increasingly concerned about the local and global consequences of tropical deforestation. Some were calling for boycotts of tropical timber not only from Brazil but also from Indonesia, Malaysia, and other places where “timber barons” were exploiting forests at the expense of local ecosystems, global biodiversity, and indigenous populations. Environmental organizations were targeting companies such as B&Q (a British home improvement retailer), Scott Paper, and Burger King, which was charged with supporting the conversion of rain forests to cattle pasture. These campaigns were part of a larger attempt to combat deforestation, which reduces biodiversity, makes local environments and forest-related livelihoods more fragile, and exacerbates global warming.
While sometimes calling for an overall reduction in the consumption of forest products, environmental organizations also hoped to highlight “good wood”—that is, products from well-managed forests harvested through low-impact and socially responsible logging. Out of these early attempts to identify “positive alternatives” to boycotts, a complex field of standard setting and certification eventually arose. Reformers founded the Forest Stewardship Council (FSC) in 1993 to oversee the certification of well-managed forests and the labeling of forest products. The FSC has stringent requirements across a range of issues, from minimizing the damage that logging can do to waterways and animal habitats to respecting the rights of indigenous communities and forest workers.
Starting from just 17 independently certified forests in 1995 (Upton and Bass 1996), by 2001 auditors had awarded FSC certificates to 281 forests, covering 21.5 million hectares of land (around 53 million acres) (Forest Stewardship Council 2001). By 2012 nearly 160 million hectares of forest area was FSC-certified, amounting to around 7.5 percent of all forest land worldwide that is designated for production or multiple use (Food and Agriculture Organization [FAO] 2010). Industry associations also developed their own certification programs to compete with the FSC (such as the Sustainable Forestry Initiative in the United States, the Malaysian Timber Certification Council, and a variety of European programs that would become part of the Programme for the Endorsement of Forest Certification [PEFC]). As a group, these associations had certified roughly 11 percent of eligible land by 2012. But the FSC survived the competition with these programs, and it was becoming increasingly visible in the marketplace. From 2001 to 2006 the number of factories with FSC “chain of custody” certification—which allows them to label products made with timber from certified forests—skyrocketed from less than one thousand to more than five thousand. In the UK the vast majority of timber and panel products sold were certified, mostly to FSC standards, by 2008. Throughout North America and Europe it was becoming common to find books (e.g., the Harry Potter series) and catalogs (e.g., Victoria’s Secret and Crate & Barrel) printed on FSC-certified paper.
Despite the growth of forest certification, most consumers in the United States and Europe have at best a vague awareness of the FSC. Consumers are far more likely to know the Fair Trade label, and consumer demand for certified forest products has been slow to develop. Furthermore, even as forest certification grew in prominence, deforestation remained a serious problem. The global rate of deforestation increased from 1990 to 2000 and continued to increase, albeit at a slower rate, from 2000 to 2005 (FAO 2006). In some countries severe deforestation persisted; between 1990 and 2005, Brazil lost 9 percent of its primary forest land and Indonesia lost 31 percent, while Gabon lost 32 percent from 1990 to 2010 (FAO 2006, 2010). Global warming was becoming increasingly clear, but it was unclear whether enough forests could be preserved to act as significant “carbon sinks” or if the continued clearing of forests would exacerbate carbon emissions.
In short, the rise of the FSC’s much-heralded eco-labeling program occurred without a great deal of demand from conscientious consumers and without transforming the dynamics of deforestation. This chapter considers how that happened. While we consider the rise of forest certification in general, we pay particular attention to the FSC, which has the most stringent standards and the most backing from environmental NGOs. As we will see, the FSC’s standards have not always been perfectly implemented, but its requirements for forest management are far from empty greenwash. Yet its ability to slow deforestation has been quite limited. Forest certification has led to some reforms in the production of wood and paper products, but the links between the label and forest-level improvements are far more tenuous than most observers assume.
We begin our examination of the search for sustainable wood and paper by looking at the structure of the industry. We then look at the origins of the FSC and the attempts to globalize its standards and to build a market for certified forest products. Looking at the evidence on implementation reveals several reasons why forest certification failed to stem the tide of deforestation. A closer look at the implementation of FSC standards in Indonesia further clarifies the limits of the certification model.
Approximately 30 percent of the world’s land area is covered by forests. Much of this is concentrated in a few countries with especially large tracts of forest land. Russia alone contains 20 percent of the world’s forest land, followed by Brazil (which has the largest area of primary natural forest), Canada, the United States, China, and the Democratic Republic of the Congo (FAO 2006). Most forest land around the world is publicly owned, and governments grant permits, or “concessions,” to companies to harvest wood from particular areas. This harvesting can sometimes be quite destructive, even if it stays within the bounds of what is allowed by the permit. But as advocates of sustainable forestry have argued, natural forests can also be harvested in ways that allow for natural regeneration; preserve ecosystems; and minimize damage to waterways, habitats, and the livelihoods of local people. Wood and especially paper products may also originate from timber plantations—that is, planted forests. These monoculture plantations (commonly eucalyptus, acacia, or pine) lack most of the ecological benefits of natural forests, and the desire to develop large plantations often means the destruction of natural forests. Still, timber plantations can sometimes help to reduce pressures on natural forests and provide a steady supply of timber for pulp and paper manufacturing.
The global timber trade stretches back to the era of colonialism. But today’s “global factory” has integrated different locations like never before. Timber harvested in Cameroon, Russia, or Malaysia may be shipped to factories in China or Vietnam to be manufactured into furniture for sale in the United States. Timber plantations in Brazil feed massive plants that manufacture wood pulp for the production of paper for the European market. Even timber harvested from North American and European forests may be shipped to other countries for manufacturing before being returned to those consumer markets.
Consumers in North America and Europe have a disproportionate influence on the world’s forests. Roughly three-quarters of the world’s wood products and two-thirds of the world’s paper are consumed in affluent countries (with the United States and Japan being especially important) (Dauvergne and Lister 2011, 33). Despite the growth of recycled paper and non-wood building materials—and predictions of a “paperless office”—global timber production in 2012 was nearly 50 percent higher than what it had been in 1961 although lower than its peak in 1989.1 Wood for construction, furniture, and flooring continues to be in high demand, but the shape of demand for paper products has changed. In the United States the total consumption of toilet paper has now surpassed consumption of newsprint, and Americans consume more toilet paper per capita than consumers elsewhere (European Tissue Symposium 2008; Levitz 2012). In addition, while some types of paper use are declining, the globalization of production has increased demand for paperboard/cardboard packaging and wood shipping pallets (Dauvergne and Lister 2011).
Companies based in North America and Europe still dominate the global timber industry, but many large pulp and paper manufacturers (e.g., International Paper, Stora Enso) have built plants in developing countries to take advantage of timber supplies, low labor costs, and access to those markets. Large retailers have also contributed to the global integration of the timber industry. Walmart has become the largest retailer of wood furniture in the United States, helping China to become the world’s top exporter of furniture (Cao, Sun, and Eastin 2014; Dauvergne and Lister 2011). The role of American and European markets should not be overstated, however. With economic growth, China, India, and Brazil are becoming major timber markets, and companies based in the Global South (e.g., Asia Pacific Resources International in Indonesia, Fibria in Brazil) are beginning to challenge the dominance of the northern paper companies.2
The structure of production depends in large part on the product. Consider furniture, paper, and lumber. Furniture production has become a strongly “buyer-driven” global value chain, with a large number of manufacturers around the world selling to a small number of large retailers in North America and Europe, especially in the discount market. Walmart, IKEA, and other leading furniture retailers (e.g., Target, Pier 1, Pottery Barn, JYSK) source products from factories in China, Indonesia, Vietnam, and Poland, among others (Scott 2006), and they regularly shift from one supplier to another (Dauvergne and Lister 2011). In many ways the structure of production in this labor-intensive industry resembles the apparel industry as described in chapter 5.3 In contrast, paper manufacturing is capital-intensive, with large investments necessary to operate pulp and paper plants. Partly because of this, many of the leading companies in this industry are vertically integrated, from the planting and harvesting of timber plantations to the production of tissue paper, office paper, diapers, and packaging materials.4 The lumber industry lies somewhere in between. Lumber companies usually engage in harvesting logs and processing them into sawn wood (solid lumber) or plywood (made from multiple layers of wood). But the costs of setting up a sawn wood/plywood plant are low, so many factories without their own harvesting operations have also arisen around the world. In fact, some governments (e.g., Indonesia, Brazil, Ghana, and parts of the United States and Canada) have banned the export of raw, unprocessed logs in order to support domestic timber-processing industries.
Despite these differences in products, all of them have been subject to growing concentration and power in the retail end of the industry. For paper, Staples, Office Depot, Walmart, and other mega-retailers have become increasingly powerful, largely by contracting for their own private label lines of paper (Kumar and Steenkamp 2007). Sawn wood and plywood, which are essential to home construction and improvement, are increasingly likely to be sold through “big box” retailers such as The Home Depot and Lowe’s in the United States or Kingfisher and its various outlets in Europe (B&Q, Castorama, and Brico Depot) (Dauvergne and Lister 2011; McDermott and Cashore 2009).
Concentration in the retail sector has had two main consequences. First, large retailers have gained the power to squeeze suppliers on price. Writing about furniture, Peter Dauvergne and Jane Lister (2011) describe this process:
Big box retailers . . . are known to strike buying contracts with suppliers that take up a large fraction of a factory’s production capacity. The supplier then invests in a redesign of its facility to meet the huge order. The following year the retailer may then offer the same purchase order, but now demand a lower price: say, a 5 percent discount. The supplier is then stuck, often having gone into debt to raise production to meet the first year’s big order. (7)
Under pressure to keep prices low, some manufacturers have turned to cheap, illegally harvested wood. The rise of discount furniture manufacturing in China, for instance, has played a significant role in driving the rise of illegal logging in Asia and Africa (Lawson and MacFaul 2010). Even if the wood is of legal origin, price pressures and small profit margins make it difficult for forest management companies to invest in reduced-impact logging methods and other environmentally friendly practices. (As we will see, demand for low prices has limited the effectiveness of forest certification.)
Second, concentration in the retail sector has provided opportunities for environmental activists to mobilize public pressure against large, well-known firms. In the UK activists from Friends of the Earth set up giant inflatable chainsaws in the parking lots of B&Q stores in the early 1990s, linking that company to tropical deforestation. In the United States the Rainforest Action Network used similar tactics in targeting The Home Depot over the destruction of domestic and foreign old-growth forests. As Staples was becoming the largest office supply retailer in the United States, it also became the target of campaigns over its paper suppliers’ role in deforestation in Southeast Asia. These campaigns have revealed many destructive and shadowy aspects of the global forest products industry, including violence by logging companies against indigenous people, logging permits gained through patronage and corruption, harvesting methods that leave local environments devastated, and corporate structures that use “front companies” to shield owners from accountability. In addition, campaigns targeting well-known retailers have been used to build markets for alternative wood products, such as those that are certified by the FSC.
As discussed in the introductory chapter, global standards spring not from some abstract global order but from the projects of specific individuals and organizations. This is especially clear in the field of sustainable forestry, where particular communities of experts and environmentalists have sought to globalize their approaches to sustainability. Industry associations have also attempted to define global sustainability, and the result has been an expanding and contentious field of forest certification. Errol Meidinger (2003) called this “a loosely networked social field in which there are several centers of activity that closely monitor each other. . . . Relations among them involve a complex, shifting mix of mutual observation, direct communication, trust, distrust, mutual adjustment, cooperation, coordination, and competition” (276). In the following section we show how forest certification arose, with particular attention to the founding of the FSC and its growing market presence.
The Forest Stewardship Council was founded in 1993 by a coalition of environmental organizations, foresters, and companies (including several retailers and timber importers in the United States and Europe). To understand how this coalition came to agree on the need for forest certification, we must look back to the late 1980s and early 1990s. In response to consumer concern about deforestation and potential boycotts, tropical timber exporting companies and their governments began making a number of impressive-sounding but usually meaningless or unverified claims about “sustained yield” forestry (Upton and Bass 1996). Environmentalists sought to expose this as greenwash (WWF 1994 [1991]), but many environmental groups were also uncomfortable with boycotts, which they feared would punish forest-dependent populations or unintentionally promote less-sustainable alternatives to wood. Even those who supported boycotts, such as Friends of the Earth and the Rainforest Action Network, also began producing “Good Wood” guides to identify alternatives.
It was the search for “positive alternatives” to the “blunt tools” of boycotts that ultimately produced forest certification initiatives. Starting around 1989 a small group of environmentalists, indigenous rights advocates, foresters, and woodworking companies began to formulate plans for an independent association to certify sound forest management. The Woodworkers Alliance for Rainforest Protection, made up of small, craft-based companies in the United States and Europe, played an important role (Ecological Trading Company 1990). So did a small group of foresters who had worked together on community forestry projects in South America. Dubbed the “Peace Corps–Paraguay mafia” by their collaborators, this group saw greening markets in Europe and the United States as a “tremendous market opportunity for the ‘wood producer projects’ in the U.S. and overseas” (Donovan 1990). A few companies and nonprofit organizations, such as Scientific Certification Systems and the Rainforest Alliance, were beginning to certify forestry operations, and they too became part of the project to build a larger body to standardize and provide credibility for this activity. Environmental NGOs, especially WWF (which originally stood for “World Wildlife Fund”), soon took a leadership role in convening and expanding this group, partly due to frustration with the effort to build a binding intergovernmental forestry convention, which ultimately failed at the 1992 Earth Summit. In 1991 WWF organized the first of many “buyers’ groups” of retailers, including B&Q, that would commit to selling certified products.
By 1993 these various players had founded the Forest Stewardship Council, which developed a set of “Principles and Criteria” for responsible forest management, a product label, and a system for accrediting certifiers. FSC members included companies, but they were limited to having a minority share in the voting and executive power of the organization. The FSC’s architects were paying attention to the growth of certification in organic agriculture and fair trade, but they also sought to create a “unique new tool” that could take old conflicts between industry and environmentalists and “resolve that fight over here, with a completely new ground and completely new outlook.”5 The FSC’s founders agreed on a fairly stringent set of standards that would require companies to minimize the environmental effects of logging, protect plant and animal habitats, respect the rights of indigenous people, generate benefits for local communities and forest workers, and much more. They hoped to give timber companies an “incentive that would tap into a very efficient engine, which is the market . . . and tap the power of the consumer to create change. [It was] a non-regulatory approach that took the power of the consumer and turned it into change—basically let people vote with their dollars.”6 Some even framed this as “a different kind of citizenship; it’s like consumer citizenship, because people widely recognize that governments don’t do what they’re supposed to do, or that there are limitations on it.”7
The FSC soon faced competition from other certification initiatives. In Canada the main forest products industry association (the Canadian Pulp and Paper Association) asked the Canadian Standards Association to develop a sustainable forestry standard, which was released in 1996. Dissatisfied with the limited space for industry involvement in the FSC, Canadian companies promoted this standard as an alternative (C. Elliott 2000). In the United States the American Forests and Paper Association, the main industry association, developed the Sustainable Forestry Initiative (SFI) and turned it into a certification program in 1998. Throughout Europe industry associations and owners of forest land organized their own certification systems, which soon joined together in the Pan-European Forest Certification (PEFC) system (Cashore, Auld, and Newsom 2004). By 2003 this group had expanded its scope beyond Europe (and changed its name to the Programme for the Endorsement of Forest Certification), consolidating in one umbrella organization most “homegrown” competitors to the FSC, including those in Malaysia, Chile, and Gabon, as well as the Canadian and American programs.
These programs generally had less stringent standards than the FSC, but through processes of comparison and competition some convergence occurred. PEFC-affiliated programs gradually strengthened their standards (Overdevest 2010), while the FSC made it easier for products to bear its logo without originating entirely in certified forests. As we will see, the latter step helped the FSC increase its visibility in the market, although its quest for growth also led to some questionable certifications (Rainforest Foundation 2002). Still, the FSC did not reduce its stringent requirements for certification, and its advocates managed to convert opposition or ambivalence into support in some markets (Cashore, Auld, and Newsom 2004). Competition between the FSC and PEFC persists to this day. The FSC has greater support from major environmental NGOs (although some also criticize it) and from large retailers in the United States and Europe, but the PEFC has more certified forest land, more support from manufacturing industries, and a strong foothold in some markets. Although the standards of the two groups converged to some degree, some crucial differences remain. For instance, the FSC has stronger prohibitions on the conversion of natural forests to plantations and more stringent requirements on preserving “high conservation value forest” areas.
Casual observers often assume that certification initiatives arise in response to demand from conscientious consumers. But in this case forest certification emerged before sizable demand from individual consumers, and its supporters had to work strategically to “make a market” for certified products. Retailers such as B&Q and The Home Depot hoped that consumer demand would eventually emerge, but they admitted that they were “putting the cart before the horse” in supporting the FSC.8 “Industry-wide customer demand for certified wood is practically nil” (Caulfield 2001, 2), and “the momentum thus far has largely been in anticipation of customer demand, rather than in response to it” (Home Depot representative, qtd. in Journal of Forestry 1993). As Michael Conroy (2007) puts it, “The appearance of ever-greater quantities of FSC-certified wood in Home Depot and Lowe’s stores in the US is not a response to hordes of consumers asking for FSC. If you doubt it, just ask the sales associates; you’ll find that it is still rare for a salesperson to have any notion of what the FSC represents” (292). IKEA is a major supporter of FSC certification, having pledged to eventually use 100 percent certified wood for its furniture. But it does not apply the FSC logo to its products, reportedly because it does not want to distract from its own brand image.
Why, then, did major retailers make early commitments to stock FSC- certified products? The answer lies in social movement campaigns that publicly charged retailers with contributing to global deforestation and asked them to shift to certified wood in response. In the UK, Friends of the Earth organized pressure against B&Q, which became an early supporter of the FSC. In the United States and Canada, the Rainforest Action Network, Coastal Rainforest Coalition (later called ForestEthics), Greenpeace, and others used banner drops, store protests, and media campaigns to shame companies such as The Home Depot, Staples, and Victoria’s Secret. In addition to the “stick” of protest and negative publicity, many campaigns implicitly or explicitly held out a “carrot” of an end to the campaign if a company supported FSC certification (Cashore, Auld, and Newsom 2004; McNichol 2006). As one leader of the Rainforest Action Network remarked, “It was like good cop/bad cop. We were the FSC’s bad cop” (qtd. in Carlton 2000). A ForestEthics leader similarly explained its approach to certification: “It used to be that you either worked with companies or against them. But that’s foolish and a false choice. We help companies change, but we don’t take no for an answer” (qtd. in Caplan 2005).
Campaigns also had larger ripple effects. Once The Home Depot agreed to promote FSC-certified products, its competitor Lowe’s soon followed suit. After Victoria’s Secret agreed to use FSC-certified paper for its catalogs, Williams-Sonoma and Tiffany began to do so as well (Conroy 2007). Since the early 1990s WWF had been organizing “buyers groups” of companies that agreed to promote certification in their supply chains. The first of these, made up of British companies, was soon followed by buyers groups in North America, Germany, the Netherlands, Belgium, Switzerland, and Austria (Gulbrandsen 2010).
Still, without significant consumer demand, how did the FSC project garner enough resources to stay afloat? In part it was support from philanthropic foundations that kept the project going. From 1992 to 2001 foundations contributed nearly $40 million to forest certification initiatives. Most of this came from the Ford Foundation, Doris Duke Charitable Foundation, Rockefeller Brothers Fund, and several others that had formed a “Sustainable Forestry Funders” network to support the FSC, its constituents, and the development of buyers’ groups (Bartley 2007a). In addition, supporters of the FSC were successful in getting government procurement offices to adopt a preference for certified products in public purchasing. The UK government’s procurement office proved especially important in supporting FSC-certified products and in putting pressure on competing systems to strengthen their standards (Overdevest 2010). Advocates of the FSC also got its standards to be preferred in the US Green Building Council’s LEED (Leadership in Energy and Environmental Design) standards for environmentally friendly buildings. As governments, companies, and universities built LEED-certified buildings, the market for FSC-certified wood products grew, even with minimal knowledge among individual consumers.
To be sure, consumers were not completely uninterested in forest certification. A survey of American consumers in 1995 found a segment of individuals who said they were willing to pay significant premiums for certified forest products (Ozanne and Vlosky 1997). Other studies suggested that consumers in North America and Europe might be willing to pay premiums of 4 to 20 percent, depending on the product (Ozanne and Vlosky 2003). But an early study of the sellers of FSC-certified products in the United States found that most were not selling these at a premium price, and the few that were received premiums of 1–5 percent (Humphries, Vlosky, and Carter 2001). As discussed in chapter 2, there was a significant gap between consumers’ attitudes and their market behavior. Furthermore, even as the volume of FSC-certified goods increased, consumer awareness of the FSC label remained low. The FSC and its supporters launched numerous consumer awareness campaigns, but their results were highly uneven. In recent materials the FSC has estimated the rate of basic consumer awareness of its label to be as high as 71 percent in the Netherlands but only 28 percent in Germany; 21 percent in the United States; and 14–15 percent in France, Sweden, and Australia (FSC 2013). (As a comparison, fair trade certification had achieved similar rates of consumer recognition as early as 2000: 74 percent in the Netherlands, 41 percent in Germany, and 13 percent in Sweden (Linton et al. 2004).)
A turning point for FSC’s place in the market came when the organization altered its approach to labeling. Early on, the FSC had shifted from a purist model of certifying a product only if 100 percent of its inputs were certified to a percentage-based model, in which a product might be labeled as “FSC 70%.” But then in 2004 the FSC introduced a “volume credit” system. This allowed a company that was getting, for instance, 50 percent of its wood or pulp for a particular product line from certified forests to apply the FSC label to 50 percent of the products in that line. In the aggregate the total amount of certified wood or pulp and the volume of labeled products should match, but a given product might carry the FSC label without necessarily coming from a certified forest. The noncertified inputs would need to be verified to the FSC’s “controlled wood” standard, which prohibited the most destructive forms of logging (i.e., logging that was illegal, destroyed “high conservation value forests,” violated local people’s rights, or relied on GMOs). But this standard is far less costly and difficult for companies to comply with than the full FSC standard. This change made it easier for firms to match the supply of certified inputs with the demand for certified products and spurred the growth of the FSC label, especially on paper and packaging (Conroy 2007). For pulp and paper factories the new system meant the factory did not have to spend money keeping certified and noncertified inputs separate. This is one change that allowed the “mainstreaming” of the FSC label. As we will see in the next section, forest management standards themselves were also revised over time, further altering the meaning of the FSC label.
The FSC also increased its market visibility by, in effect, taking over the recycled paper market. Created in 2004, the “FSC Recycled” label allowed products made from recycled wood fiber (at least 85 percent of which must be post-consumer recycled material) to bear the FSC name. Since recycled paper first became common in the 1980s, manufacturers had been applying the classic three-arrow recycled label themselves, typically with some oversight from governments and sometimes with external certification. The FSC Recycled label and similar labels created by the PEFC have increasingly taken over this terrain. The incorporation of recycled material into the FSC has also fueled the growth of paper labeled as “FSC Mix,” which is manufactured from a mixture of recycled content, pulp from an FSC-certified forest, or pulp from a “controlled wood” source (as discussed above). It is possible under this system that a paper product with the FSC logo may have no connection whatsoever to an FSC-certified forest. While consumers typically imagine a direct link between an eco-labeled product and its sources, the reality is far more complex, and by some accounts this muddies the goals of the FSC (Moog, Böhm, and Spicer 2014). On the other hand, the system has allowed FSC Mix papers, some containing FSC-certified pulp, to gain a significant presence in the market, priced only slightly above completely noncertified paper from virgin pulp. Staples and Office Depot sell their FSC Mix paper (with 30 percent recycled content) for approximately 14 percent more than the most basic option (as of 2013). Similar 100 percent FSC Recycled paper was priced at a 38 percent premium.
Overall, the FSC and its supporters have had some success in building a market and fending off challenges from competing initiatives (see Cashore, Auld, and Newsom 2004). But the FSC did make some significant compromises along the way. These have helped to dramatically increase its market visibility, but they have also raised questions about its ultimate impact. To examine this further, we must look at the “on the ground” implementation of sustainable forestry standards.
The “on the ground” effects of sustainable forestry standards depend on forest management companies deciding to seek certification. Typically this is in response to a request from a retailer or manufacturer. The hope of FSC supporters was that if retailers could charge a premium for certified goods, producers could also get a premium price for harvesting certified wood. Some even hoped that this premium would be enough to “add value” to forest management and reduce the temptation to convert a forest to agricultural uses. As we will see, producer premiums have been far from guaranteed, and this has made the link between product labeling and major on-the-ground improvements more complicated than originally expected. But that is just one of many complications in the implementation of FSC standards.
If a forest management company does want to get its operation FSC certified, it must hire an auditor accredited through the FSC system to assess compliance with the FSC’s Principles and Criteria. If the auditors find that the company is in compliance, with no major unresolved problems, they grant a certificate that is valid for five years, subject to follow-up audits each year, or more frequently if necessary, to check on unresolved problems.
In part because the standards and auditing procedures are relatively strict, most of the initial growth of FSC certification occurred in the forests of North America and Europe, where legal requirements were relatively close to FSC standards and companies were accustomed to dealing with environmental demands. Recognizing that it was having a minimal impact in the tropical forests that initially inspired it, the FSC aggressively pushed for growth in the global south. A joint project between WWF and the World Bank sought to vastly expand the amount of FSC-certified forest area around the world. This project, as well as assistance from government aid agencies, retailers, and NGOs, helped to prepare companies for their audits and subsidize some of the costs of certification. In addition, in some cases governments directly supported certification, as in Bolivia, where the government introduced forestry regulations that were highly consistent with FSC standards and treated certification as proof of regulatory compliance (Nebel et al. 2005). Still, as of 2005 less than half of FSC-certified forest land was in developing or transitioning countries (e.g., Brazil, Russia, and Bolivia) (Cashore et al. 2006). But by 2012 Russia alone accounted for 48 percent of all FSC-certified forest land, with sizable amounts certified in Brazil, China, Poland, and a rapidly growing presence in several parts of Africa, including the conflict-ridden Congo Basin.
But what difference was certification making on the ground? To answer this question researchers have often examined the “corrective action requests” issued by auditors, which provide a window into the specific kinds of changes that companies must make in order to become (or remain) certified. These studies generally show that FSC certification requires a variety of changes, “sometimes minor, but sometimes involving radical departures from the previous management style in a region” (Nussbaum and Simula 2004, 19). For example, a study of FSC certificates in twenty-one different countries showed that auditors frequently demanded changes involving forest management plans, conservation areas, logging roads/trails, worker safety, and relations with local stakeholders, among other things (Newsom and Hewitt 2005). In certified community forests in Mexico, auditors frequently pushed forest managers to reduce the environmental impacts of logging roads/trails (Klooster 2006).
It is clear that becoming FSC certified is not easy, and auditors are not simply handing out certificates. (The quality of auditing in the FSC system has been higher, for instance, than in the factory certification initiatives discussed in chapter 5.) But four other issues temper this interpretation. First, a close look reveals that auditors more frequently require companies to formalize and document their management processes than to prove that the performance outcomes are improved (Nussbaum and Simula 2004). Auditors can easily require a firm to adopt a sound management plan, for instance (and often do), but they may not be able to assess whether the plan is fully implemented in the field. Second, a request for corrective action does not always mean an effective and durable change was made. Problems can persist or reappear over time, sometimes leading the certificate to be suspended, but sometimes leading to a long string of small improvements that never quite meet a strict reading of the standard (see Bartley 2012; WWF European Forest Programme 2005). Third, although the FSC covers a wide range of environmental and social standards, not all standards are equally scrutinized in the field. In particular, although the FSC calls for freedom of association—that is, the right of forest workers to form their own unions—our evidence suggests that this is rarely audited vigorously. In China, where freedom of association is prohibited by the state, audits for FSC have completely neglected this issue.9 In their study of changes necessary for FSC certification, Deanna Newsom and Daphne Hewitt (2005) find that firms in developing countries typically had to address workers’ safety, wages, or living conditions, but the researchers did not even mention issues related to freedom of association. The neglect of labor rights likely stems from the fact that the FSC’s key founders and watchdogs are environmental and indigenous rights NGOs, not trade unions and labor rights groups. Finally, there is evidence that auditors sometimes tailor their judgments more to current best practices in the region than to the substantive requirements of the FSC standards (Cerutti et al. 2011; Schulze, Grogan, and Vidal 2008). In other words, where local best practices are well below a strict reading of the FSC standards, auditors tend to relax their interpretation of standards.
As this final point suggests, the character of FSC certification depends in part on where a forest is located. The FSC’s global standards have to be “translated” into locally meaningful practices. This is supposed to occur through a multi-stakeholder national/regional standard-setting process, but this has not occurred in many regions, leaving auditors to do this work in a rather ad hoc fashion. Examining forest certification in Russia, Olga Malets (2013) notes, “It would be wrong to argue that companies simply had to identify practices that were not in compliance with FSC requirements and substitute them with the ‘correct’ practices. Rather, both activists and company forest managers experimented and combined global, external, and locally available, domestic ‘elements’—i.e., legal requirements, global concepts, and on-the-ground practices—in different ways” (315). Even different regions of the same country can vary substantially. In the Russian far east, where illegal logging is common, industry and government fiercely resented the FSC’s incursions, creating a challenging environment for auditors (Tysiachniouk 2012).
As discussed in the introductory chapter, the “mainstreaming” of alternative production standards often involves a watering down of standards and greater accommodation to the interests of large companies. In the case of the FSC, mainstreaming has influenced the meaning of certification on the ground in several ways. The FSC’s decision to allow the certification of timber plantations, so long as they were not recently converted from natural forests, rankled some of its early supporters, who charged that monoculture plantations were not in line with the FSC’s initial purpose. In addition, the FSC’s original ban on logging in “primary” old-growth forests was later turned into a more nuanced set of standards for conserving “high conservation value forests,” which has sometimes proven to be a slippery notion (Cashore, Auld, and Newsom 2004; Tollefson, Gale, and Haley 2008). Furthermore, with the FSC seeking growth and its certifiers profiting from conducting more audits, several highly controversial certificates have been awarded (Rainforest Foundation 2002).
Yet the FSC’s mainstreaming has also been held in check by scrutiny from NGOs—both within and outside of the FSC membership—and decision-making rules that require support from nonindustry constituents to make changes. Even though the FSC sought to increase the amount of certified forest land, it took steps to ensure that its decision-making process remained open and that it did not lose support from environmental NGOs (Klooster 2010). As Dan Klooster puts it, “As certification systems mainstream, their alternative character is likely to erode; lower standards are a tradeoff for increased acceptability. The need to protect system legitimacy, however, provides countervailing pressure to maintain inclusiveness and rigorous standards” (11).
In addition, under pressure from NGOs, the FSC has recently disassociated itself from some companies that seemed to be using the FSC name to cover up a highly destructive set of operations. In Indonesia the pulp and paper giants APP (Asia Pulp and Paper) and APRIL (Asia Pacific Resources International) have routinely cleared natural forest land, disrupted endangered species, and relied on questionable sources of “mixed tropical hardwoods” to feed their pulp mills. But they had also gotten some areas verified as “controlled wood” and were preparing to sell paper labeled as FSC Mixed. In 2007, after journalists publicly exposed this plan—generating a storm of controversy—the FSC banned APP from using the FSC logo and soon developed a new policy to prevent this kind of association in the future (Wright and Carlton 2007). In 2013 the FSC invoked this policy in disassociating itself from APRIL after a complaint was lodged by Greenpeace, WWF, and the Rainforest Action Network. That same year, the FSC also disassociated itself from the European timber company Danzer over its activities in the Democratic Republic of the Congo. The impoverished and war-torn Congo basin was becoming a growth area for FSC certification, and a forest managed by Danzer had been approved as “controlled wood.” But an investigation by Greenpeace charged that the company was engaged in illegal logging and complicit in violence against local residents (Greenpeace 2011). In these three cases, the FSC has clearly clamped down and sought to prevent mainstreaming from completely undermining its credibility.
Despite its numerous shortcomings, FSC certification is a reasonably credible indication that forest management is at least better than average in some respect. But this does not mean forest certification has been effective in reducing deforestation. Indeed, even as certification gained steam, deforestation rates in many parts of the world continued to increase at alarming rates (FAO 2006). Generally, research on forest certification paints its overarching consequences as quite mixed (Auld, Gulbrandsen, and McDermott 2008). As R. E. Gullison (2003) puts it, there is “clear evidence that certification produces biodiversity benefits by improving management of existing timber production forests during the auditing process. In contrast, the incentives offered by certification are insufficient to prevent deforestation” (162; emphasis added). In Bolivia, for instance, FSC certification became quite popular, partly due to the government support mentioned above, but the increased rate of certification did not slow the rate of deforestation (Nebel et al. 2005).
To some extent deforestation persists simply because the vast majority of the world’s forests are not certified. (As mentioned above, FSC certification covers roughly 7.5 percent of eligible land, and PEFC certification covers roughly 11 percent.) It is costly and onerous for forest management companies to obtain FSC certification, and most companies have not seen the benefit of doing so, either because their products are sold in markets with little demand for certification or because demands for certification are not being backed by premium prices. For some types of timber, such as rare, high-value tropical hardwoods, there is evidence that producers can receive sizable premiums for FSC certification (Espach 2009; Kollert and Lagan 2007; Nebel et al. 2005). But these same studies find that premiums are small or nonexistent for lower-value tropical hardwoods. For most forest management companies, market premiums have been uncertain or so small that they barely cover the direct costs of certification. Some retailers that support the FSC (e.g., IKEA and Walmart) also tightly squeeze prices in their supply chain, leaving little if any room for producer premiums. To compensate for the dearth of producer premiums, governments, NGOs, and companies in affluent countries have sometimes stepped in to subsidize the costs of certification in developing countries (Molnar 2003; Borneo Initiative 2014).
Yet a more fundamental reason for the limited influence of forest certification is that the main drivers of deforestation lie outside its sphere of influence. As mentioned earlier, a great deal of deforestation occurs through the burning or clearing of forest land so that it can be converted to agricultural uses. In South America the expansion of soy plantations (see chapter 4) and cattle ranching have contributed to the loss of natural forest land. In Southeast Asia what were large tracts of natural forest land have increasingly been converted to timber plantations or oil palm plantations. Initially some supporters of the FSC hoped that certification (unlike boycotts) would add value to managed forests and thus reduce the temptation to convert them to agriculture. But over time it has become increasingly clear that any market benefits available for harvesting certified timber are dwarfed by the money that can be made by converting land to agriculture, as we will see in the case of Indonesia below. Furthermore, governments have often prioritized agricultural development at the expense of forests. Forest certification, which has sought to “bypass” governments to instead enforce standards through supply chains, has had little influence on these decisions.
Forest certification has also failed to stem the tide of illegal logging. While certification has sought to improve and recognize good forest management, it has had little bearing on the lucrative illegal timber trade. In Indonesia illegal logging exploded during a turbulent political transition, and scholars estimated that one-half to three-quarters of all timber production in the late 1990s could have been illegal (Tacconi et al. 2004). In the far east of Russia unauthorized logging feeds into a complex and shadowy timber trade on the Chinese border. In Cambodia the rise of illegal logging led an international NGO, Global Witness, to be brought in as an independent monitor of the forest sector. But the illegal timber trade was so enmeshed with the ruling government and its elite supporters that Global Witness was soon dismissed and replaced with a more conciliatory monitor.
Much illegal timber soon finds its way into legitimate supply chains as it flows “from Russia, Africa, and Southeast Asia into China[,] where it is turned into ‘legal’ products for worldwide export” (Dauvergne and Lister 2011, 122). Estimates have suggested that more than a quarter of the wood imported to the European Union in the 2000s came from illegal or suspicious sources (Dauvergne and Lister 2011). Between 2008 and 2010, with growing international attention to illegal logging and concerns from some industry groups that it was depressing the prices of legally harvested wood, the United States and EU each passed laws that penalized the sale of products that can be traced to illegal logging. These striking legislative acts—a revision of the Lacey Act in the United States and the passage of the EU Timber Regulation—have generated a new set of debates about the meaning of legality and its enforcement.10 This emerging timber legality regime will certainly influence the future of forest governance, but its rise has also served to illustrate the limited impact of voluntary sustainable forestry certification (Bartley 2014b). To further examine what certification is and is not capable of, we turn to a closer examination of forest certification in Indonesia.
As research on sustainability is increasingly recognizing, global standards are modified and often muted as they are translated into practice in particular places (Malets 2013). Looking at what it takes to localize a global principle reveals a great deal about the practical implications of certification and labeling. In this section we show some of the contradictions of applying the FSC’s standards in one crucial tropical forest context, Indonesia.
In addition to being the world’s fourth-largest country by population, Indonesia has the world’s third-largest amount of tropical forest land. Yet from 1990 to 2005 Indonesia lost 31 percent of its primary forest cover (that is, relatively undisturbed native forests) and 24 percent of all forested land (FAO 2006). Indonesia also went through a major political transition during that period. After ruling the country for more than thirty years, President Suharto was forced out of office in 1998, and the authoritarian “New Order” regime gave way to an era of democratization and “Reformasi.” Soon thereafter Indonesia embarked on a set of reforms to decentralize control of natural resources, shifting some power from the central government to district governments. These ended up being devastating for forests and in some ways facilitating the rise of illegal logging. Indonesia is an important case for forest certification, but for these reasons among others, also a very difficult one.
Deforestation in Indonesia had been at the center of tropical timber boycott campaigns in the 1980s. In the 1990s, as a global field of forest certification began to emerge, the teak plantations of Perum Perhutani, the state forestry company, were among the first to be certified. Although the company had long had tense relations with local people (Peluso 1992), its scientific agroforestry methods were viewed positively by many environmentalists, and it was selling timber to Smith & Hawken, an American outdoor furniture company at the forefront of sustainable business initiatives (Taylor and Scharlin 2004). The original certificate, issued by the Rainforest Alliance, eventually led to a series of FSC certificates, and certified teak from Perum Perhutani flowed to a number of specialty furniture manufacturers. But in 2001, amid a rising tide of illegal logging and violence against local people by the company, Perum Perhutani’s certificates were suspended (Donovan 2001). FSC certification, even with secure sales channels and premium prices, had proven insufficient to guarantee fair and sustainable conditions in the forest.
This case is a microcosm of sorts for the larger story of forest certification in Indonesia. In response to demands from retailers a few forests in Indonesia did achieve FSC certification. But a tumultuous domestic economic and political situation limited the number of firms that were interested and made it difficult for them to get—or stay—certified. At the same time that FSC certification was beginning to cover 15–20 percent of eligible forest land in Russia and Brazil (Blaser et al. 2011; Malets 2011) it covered less than 2 percent of “production forest” land in Indonesia (as of 2009). Moreover, conflicts between timber companies and villagers were common in certified and noncertified forests alike. Forest certification could do little to counteract the rise of illegal logging and the conversion of natural forests. In short, the growing global market for certified wood and paper products had, at most, a minor effect on forest conditions in Indonesia.
The clearest links between the growing market for certified wood and Indonesian forests occurred in the plywood industry. The Home Depot, like other home improvement retailers, was under fire for its sales of plywood from tropical forests. But as it began to demand FSC-certified products—and in some cases offer premiums for them—some plywood manufacturers in Indonesia were able to respond. Take, for instance, PT Intracawood, an Indonesian company with a marketing arm in the United States that supplied directly to The Home Depot. After failing its first attempt, in 2005 Intracawood successfully got its timber concession in East Kalimantan certified to FSC standards. Importantly, PT Intracawood, like several of the other Indonesian timber companies that became certified (e.g., PT Sumalindo, PT Suka Jaya Makmur), was an integrated plywood manufacturer, responsible for managing forests and manufacturing the logs into plywood. The simple structure of this part of the forest products industry made the link between demand and supply relatively straightforward. In contrast, in the furniture industry some retailers were demanding FSC certification, but this did not mean manufacturers could easily supply it. Furniture manufacturers in Indonesia were primarily buying timber from other companies and rarely in large enough quantities to influence how they managed the forest.11
Although PT Intracawood had a clear incentive to obtain FSC certification, the company’s operations were in many ways difficult to reconcile with FSC standards, especially when it came to community rights. There was a history of tension with communities in and around the area where the state had given Intracawood the rights to harvest. As Indonesia transitioned to democracy these tensions became more visible. One villager claimed, “When PT Intracawood first came here, we were not brave enough to say anything, because it was during the New Order regime. Since Reformasi we have spoken out” (qtd. in Colchester, Sirait, and Wijardjo 2003, 211). In some cases villagers seized machinery or blockaded roads, and the company in turn called in police and military forces (212).
The legal standing of Intracawood’s concession was also problematic. The boundaries of the company’s timber concession had not been completely finalized, and local governments had begun issuing a range of overlapping permits—that is, multiple permits for the same area of land—during a tumultuous set of decentralization reforms. Under pressure from certifiers for the FSC, the company successfully got these permits voided in 2002. But then in 2003 the national Ministry of Forestry suddenly declared Intracawood’s permit invalid, in effect ceasing the certification process.
After getting its permit reinstated, Intracawood received FSC certification in 2005 (SmartWood 2006b). But the tense community relations were not wiped away, and the auditors asked the company to make “significant progress to resolve all community disputes dating from prior to certification” (SmartWood 2006b). The auditors came to be satisfied with compensation agreements that the company made with community leaders (SmartWood 2006a). The compensation of roughly twenty-seven cents per cubic meter amounted to roughly 0.3 percent of the cost of production (based on averages in that region, as reported by Ruslandi, Oscar Venter, and Francis E. Putz [2011]). This compensation, which was supplemented by charitable contributions, may be more than villagers would have received during the Suharto era. But it was far below the compensation (of roughly two dollars per cubic meter) that was being offered by small-scale (often illegal) loggers in the era of decentralization (Colchester, Sirait, and Wijardjo 2003, 215–16). FSC certification did put a spotlight on company-community relations, but it is difficult to judge how well these agreements fulfilled the FSC’s substantive goals of supporting clear land tenure and indigenous peoples’ rights. As Marcus Colchester and his colleagues argue, there is a danger that compensation payments to communities with no real land rights ends up reproducing colonial- and Suharto-era systems of domination.
After obtaining certification the company continued to struggle to meet standards for community relations, logging practices, and erosion control, leading to several temporary suspensions of the FSC certificate (SmartWood 2008b, 2012). In one instance auditors reinstated the certificate while admitting that similar (but not identical) issues remained problematic—in essence, finessing the decision so that the certificate could continue (Smart-Wood 2008a, 2008c).12
In the case of Intracawood one finds a bit of everything—some reform and some intransigence, some scrutiny that is quite serious and some that is less so—all set within a contested and rapidly changing local context. This is apropos for the case of forest certification in Indonesia, and it should serve as a reminder that the situation on the ground is always more complicated—and often more conflictual—than a simple eco-label can represent.
The small pockets of land that received FSC certification, imperfect or not, were ultimately a small piece of the larger story of deforestation in Indonesia. Deforestation was driven in part by the expansion of the pulp and paper giants such as APP and APRIL, as mentioned above. With the stated purpose of developing timber plantations, these companies cleared large tracts of natural forest land, using the “mixed tropical hardwoods” from the cleared forests to feed their mills (Barr 2001). Sometimes the forests were cleared and the timber used, but the plantation was never developed—what became known as the “plantation hoax” (Ekawati 2009; Human Rights Watch 2006). Recently, facing intense international campaigns, these companies have made “no deforestation” pledges, but their past actions make many observers skeptical.
Even more important has been the conversion of forests to oil palm plantations. Palm oil has become an increasingly popular ingredient in soaps and processed foods around the world, a cooking oil in China and India, and a potential biofuel. With rising prices the amount of land in Indonesia designated for the growing of oil palm trees increased by more than 600 percent from 1990 to 2010, making Indonesia the world’s largest producer of palm oil by 2007 (Carlson et al. 2012; McCarthy and Cramb 2009). More than half of Indonesian oil palm expansion from 1990 to 2005 came from the conversion of forests (Koh and Wilcove 2008). Typically these forests had been categorized as “degraded” by government and thus eligible for conversion. But in the eyes of many foresters and environmental groups, these “degraded” lands were in fact rich, biodiverse forests. (In Malaysian Borneo, just across the border from Indonesian Kalimantan, researchers have found that “degraded” forests are nearly as rich in biodiversity as are primary forests [D. Edwards et al. 2011].) Moreover, as palm oil prices increased, some local governments recategorized tracts of natural forest as eligible for conversion.13
Even if a company could receive a significant premium from harvesting wood from a certified natural forest, which was by no means certain, the incentives to convert forests to oil palm plantations were high. One estimate suggests that an oil palm plantation in Kalimantan is worth nearly three times as much as a similarly sized logging operation there (Ruslandi, Venter, and Putz 2011). Yet it also happened that plantation development was used primarily as a ruse to clear an area and sell the resulting timber (Elson 2011; Gellert 2005, 1352).
Concerns about palm oil inspired a new certification initiative called the Roundtable on Sustainable Palm Oil (RSPO). In chapter 4 we argue that this type of “commodity roundtable” has a limited chance of institutionalizing alternative models of land use and economic development. Even if the RSPO succeeds in making some oil palm plantations more sustainable over time, it is clear that the growth of the palm oil industry has come at the expense of forests in Indonesia, among others, and the FSC was powerless to affect that. For consumers the politics of food and the politics of forests may appear to have nothing to do with each other. But on the ground, whether forest land will be harvested for timber or converted for use by the agri-food industry is tremendously important.
Forest certification has captured the attention of researchers; environmental NGOs; and many retailers of furniture, lumber, paper, and other forest products. But it remains at the margins of consumers’ attention in most countries. In some ways the growth of forest certification demonstrates that eco-labeling initiatives are not entirely dependent on demand from individual conscientious consumers. The FSC grew largely through support from foundations and government procurement offices, with environmental activists’ “good cop/bad cop” strategies goading retailers into support. In addition, the case of forest certification shows that a fairly credible eco-label can become prominent in the market but fail to solve the problems that originally inspired it. The growth and mainstreaming of the FSC did not result in a complete sellout, but neither did it significantly alter the dynamics of global deforestation.
Conscientious consumers often want simple assurances that their purchases are sustainable. But the complexities of industries and certification initiatives, let alone competing definitions of “sustainability,” make such assurances essentially impossible. So what does buying an FSC-certified product really mean? We believe the material in this chapter provides at least an approximate answer, although it is not a simple one. First, if a product is labeled “FSC 100%,” one can be reasonably certain that this purchase supports forest management practices that have been found to be consistent with a strict set of standards. The assessment most likely missed some problems and glossed over others, and in some regions those forest management practices may be just slightly above the norm. Nevertheless, buying this product rather than an uncertified one raises the odds of supporting decent forest management. Whether this is better than not buying the product at all is debatable, depending in part on what its substitute would be. Second, if consumers use products that are labeled “FSC Recycled” (e.g., office paper, toilet paper, paper towels, etc.), this may contribute to decreased demand for virgin pulp. But FSC Recycled products may not be significantly different from other products with high levels of post-consumer recycled material, and demand for virgin pulp could also be reduced by simply reducing one’s use of paper products. Third, if the product is labeled “FSC Mixed,” the link to certified forests is more tenuous, but this label still somewhat increases one’s odds of supporting decent forest management and avoiding the most destructive forms of logging. On the other hand, if a company touts its FSC “chain of custody” certification on its website or in advertising materials, conscientious consumers should keep in mind that this means nothing unless the company is actually selling products made from certified wood or pulp.
Yet even if the market for “FSC 100%” products grew substantially, this would be unlikely to make a big impact on global deforestation, because deforestation is being driven largely by factors that are not affected by the FSC’s label, such as conversion of forests to agriculture and government land-use policies. And even FSC-certified forests can leave a great deal to be desired when it comes to the rights of indigenous communities and forest workers. It is hard to see how this can change without greater recognition of rights by governments. Unless it coincides with vigorous social movements and significant changes in government policy, buying eco-labeled forest products is unlikely to get to the root of problems of environmental degradation and social injustice. We generally concur with Johannes Ebeling and MaïYasué’s (2009) sobering yet not entirely pessimistic assessment of FSC certification:
Conservationists need to have realistic expectations about the potential of forest certification and other market-based strategies to improve management practices on the ground. Certification is clearly no silver bullet, but could be a valuable tool in a comprehensive conservation strategy for tropical forests, which would also include enhanced environmental law enforcement, effectively implemented and ecologically-minded land-use planning, expanded protected area networks, and agricultural policy reforms. Importantly, a comprehensive forest conservation strategy must not be limited to the forestry sector itself but instead address all drivers of deforestation and forest degradation. (1153)
Perhaps the prospects for governmental action are not entirely dim. The EU and the United States have taken aggressive legislative action against illegal logging, and intergovernmental climate change initiatives such as the UN-REDD program (Reducing Emissions from Deforestation and Forest Degradation) continue to evolve. The question, which we take up in the conclusion, is whether the concerns of conscientious consumers might be redirected into projects that expand the rights of citizens, strengthen the democratic and administrative capacities of states, and restructure industries to reverse the intense downward pressure on prices at any cost. As a start, conscientious consumers must at least recognize how much is not being accomplished through even the most credible eco-labels.