AN ANALYSIS OF AS SUSTAINABLE FOREST MANAGEMENT

Environmental Studies, Aarhus University Spring, 2002 AN ANALYSIS OF FSC AS SUSTAINABLE FOREST MANAGEMENT AUTHORS: Søren Dürr Pedersen – Biology, Denmark Laura Turculet – Geography and English, Romania Sini Virtanen –Ecology and Chemistry, Finland SUPERVISOR: Lars Bracht Andersen – Master of Law (LL.M) Environmental Studies, Aarhus University Spring, 2002 AN ANALYSIS OF FSC AS SUSTAINABLE FOREST MANAGEMENT AUTHORS: Søren Dürr Pedersen – Biology, Denmark Laura Turculet – Geography and English, Romania Sini Virtanen –Ecology and Chemistry, Finland SUPERVISOR: Lars Bracht Andersen – Master of Law (LL.M) AFDELING FOR MILJØSTUDIER AARHUS UNIVERSITET Finlandsgade 12-14 8200 Århus N CENTER FOR ENVIRONMENTAL STUDIES UNIVERSITY OF AARHUS FINLANDSGADE 12-14 DK-8200 AARHUS N DENMARK e-mail: miljolare@au.dk Published by Afdeling for Miljøstudier/Center for Environmental Studies, June 2002 Printed by Fysisk Institut ISBN: 87-7785-138-2 2 AKNOWLEDGEMENT We thank the teachers who have guided us during the semester, laying the basis for this interdisciplinary approach to environmental issues. Special thanks to our supervisor, Lars Bracht Andersen, for his valuable advice and support. We also offer our gratitude to the founders of this course, to our coordinator, Hanne Lise Knudsen and to our administrator, Dorthe Birkmose. We are very grateful to the persons who have cooperated with us in making this project, offering us valuable information, advice and personal opinions: Peter Feilberg (Forest Management Certification Co-ordinator for Smartwood/NEPCon in Denmark), Jimmy Enevoldsen (Frijsenborg Forests Manager, Denmark), Kasper Kopp (Baritskov Forest Manager, Denmark), Auvo Kaivola (Secretary-General of Finnish Forest Certification Council), Jens Kanstrup (Danish FSC working group). Last, but not least, we thank our colleagues for their support and useful criticisms, and for a very nice semester together. 3 TABLE OF CONTENTS I. INTRODUCTION ............................................................................................................................6 I.1 The purpose of the project ..........................................................................................................7 I.2 Outline of the project ..................................................................................................................7 I.3 Methods ......................................................................................................................................8 I.4 Sustainability ..............................................................................................................................9 II. ABOUT FSC, ACCORDING TO THE FOUNDERS ..................................................................11 II.1 FSC-principles.........................................................................................................................12 II.2 Certification.............................................................................................................................14 II.3 FSC-logo .................................................................................................................................15 II.4 Administration.........................................................................................................................15 II.5 Group certification ..................................................................................................................16 III. THE FRAMEWORK FOR FSC ..................................................................................................17 III.1 Forest-related Social Issues....................................................................................................18 III.1.1 Multiple uses of forests ...................................................................................................20 III.1.2 Local communities..........................................................................................................21 III.2 Ecology ..................................................................................................................................24 III.2.1 Biodiversity.....................................................................................................................24 Factors that influence biodiversity.........................................................................................25 III.2.2 Soil and water bodies ......................................................................................................27 III.2.3 Pesticides.........................................................................................................................28 III.2.4 Climate ............................................................................................................................30 III.2.5 Genetically Modified Organisms (GMOs) .....................................................................31 III.3 Forest-related political and legislative issues.........................................................................32 III.3.1 A survey of the international forest regulations..............................................................34 III.3.2 The national level............................................................................................................36 III.4 Economical Issues..................................................................................................................37 III.4.1 Economic instruments.....................................................................................................37 III.4.2 Cost-benefit analysis .......................................................................................................39 III.4.3 The issue of under-pricing of forest products .................................................................39 III.4.4 The issue of the Tragedy of Commons ...........................................................................40 III.4.5 Could trade barriers solve the problem? .........................................................................41 IV. A DISCUSSION ON FSC IDEOLOGY AND PRACTICE .......................................................43 IV.1 FSC on the map .....................................................................................................................43 IV.2 Problems of certification........................................................................................................46 IV.3 The structure of FSC..............................................................................................................48 IV.4 The implementation of the FSC-principles............................................................................49 IV.3.1 Social issues....................................................................................................................50 IV.3.2 Environmental issues ......................................................................................................51 IV.3.2.1 Biodiversity..............................................................................................................51 IV.3.2.2 GMOs.......................................................................................................................51 IV.3.2.3 Pesticides .................................................................................................................52 IV.3.2.4 Soil and water bodies...............................................................................................53 IV.3.3 Laws and politics ............................................................................................................53 IV.3.4 Economic issues..............................................................................................................54 IV.4 Who are the beneficiaries?.....................................................................................................57 4 IV.5 Is (FSC) certification a new form of imperialism? ................................................................59 V. OTHER CERTIFICATION SYSTEMS .......................................................................................68 V.1 The Pan-European Forest Conservation (PEFC) ....................................................................68 V.2 Sustainable Forestry Initiative (SFI) .......................................................................................70 V.3 ISO 14001 ...............................................................................................................................71 V.4 Eco Management and Audit Scheme (EMAS) .......................................................................72 V.5 FSC vs. other certifications .....................................................................................................73 VI. CONCLUSIONS .........................................................................................................................75 REFERENCE LIST ...........................................................................................................................80 5 I. INTRODUCTION Forests cover about 3,870 million ha, or 30 percent of the Earth's land area. Tropical and subtropical forests comprise 56 percent of the world's forests, while temperate and boreal forests account for 44 percent. Forest plantations make up only about 5 percent of all forests; the rest is natural forest. The estimated net annual change in forest area worldwide in the 1990s was -9.4 million ha, representing the difference between the estimated annual rate of deforestation of 14.6 million ha and the estimated annual rate of forest area increase of 5.2 million ha. (FAO, 1999). Over half of the global production of total round wood is wood fuel, about 90 percent of which being produced and consumed in developing countries. On the other hand, industrial round wood production, totalling 1,550 million m3 in 1999, was dominated by developed countries, which together accounted for 79 percent of total global production (FAO, 1999). The main causes for forest cover changes are the conversion of forest to agricultural land. But in addition to deforestation, also forest degradation is a growing problem. Major reasons for this are over harvesting of industrial and fuel wood, overgrazing, fires, insect pests and diseases, air pollution and storms (FAO, 1999). Thus, quite many are to some degree natural, but human interference can contribute to them significantly. The Food and Agricultural Organisation of the UN (FAO) estimates that the wood consumption is going to continue to increase due to growth both in population and economics. The importance of fuel wood is probably going to increase because of new wood-based bio-energy programmes (FAO, 1999). Trends in forestry have 6 already clearly changed so that more attention is being paid to ecological, economical and social sustainability. This has even led to reduced amounts of timber harvested (FAO, 1999). I.1 The purpose of the project The goal of this report is to examine the potential of the Forest Stewardship Council to promote the worldwide maintenance of economical, ecological and social sustainability in forest areas. Since we are mainly concerned in sustainable forest management, we have not gone into detail on the subject of Chain-of-Custody (the whole range of processes that the wood goes through from the forest to the customer) certification, though we are aware of the importance of this process in the landscape of present day’s initiatives towards sustainable development. The project will look for the answers for two questions: Is FSC a reliable certification system and does it contribute to sustainable development? Can FSC be recommended in the future? We will use the initials FSC to designate the Forest Stewardship Council all through the project. I.2 Outline of the project The first chapter of the project represents a general formulation of the data of the problems that forests, forest management and forest certification raise. 7 In chapter II we establish the facts about FSC, as the FSC’s own official papers describe them: the FSC structure and administration, their main guidelines (the principles and criteria) and the certification procedures. Chapter III discusses the driving forces that lead present-day’s processes related to forest use and protection. We thus establish the framework for certification as a solution to some of the formulated problems. This includes social factors (ethical and anthropological), ecological ones, political forces and legislative initiatives and of course economical factors. The discussions in Chapter IV constitute the main part of the project. We debate the pro-s and the con-s for FSC certification, with the help of relevant literature data and of interviews with representatives of the certification-interested parties. We discuss the place of FSC certification in time and space, the FSC structure, the implementation of FSC Principles and Criteria and the actual beneficiaries of the system. Chapter V makes a short presentation of the systems alternative to FSC and establishes their main similarities and differences. Finally, Chapter VI presents the results of our analysis, the answers to the initial questions and our conclusions. I.3 Methods The framework used for this project is based on literature study and interviews. Literature is used in the introducing chapters, giving the factual background. In the 8 discussion both literature and interviews have been used. Interviewing methods were chosen to get “an up to date” impression of the ongoing debate on whether to certify or not. In recognition of this being a sensitive topic, the interviews enabled us to see the discussed issues from the point of view of the people who are directly involved in FSC (forest owners, NGO’s, vendors and certifying bodies). Before entering the discussion of FSC, a general set of tools is introduced, giving the basic knowledge relevant to the discussion (ecology, economy, political science, law, social sciences). I.4 Sustainability A traditional, simplified definition of sustainable use is that if regeneration exceeds loss, the surplus part can be exploited without endangering the future production. This is, however, a strictly economical approach, which does not take into account any ecological or social values. Besides, it does not even guarantee in practice economical sustainability due to environmental fluctuations. For example climate or natural changes in predator-prey cycles may alter the value of maximum sustainable yield remarkably from year to year (Begon et al, 1996). From an ecological point of view, sustainability includes the conservation of both individual species and whole ecosystems. Therefore, a plantation forest producing great amounts of timber may be considered to be economically but not ecologically sustainable as a way to use the forest. In addition, also economical sustainability includes other aspects than just wood production. Often multiple uses of forests, i. e. recreation, hunting and gathering may be very important to the economy of the area (van den Bergh, 1996), and if long-range effects like forests’ contribution to climate 9 change are considered, the traditional regeneration-loss model should be modified markedly. Economical sustainability overlaps significantly also with social aspects when considering issues like employment and recreational and cultural values of forests. The reason for maintaining sustainability can easily be seen from a very selfish point of view, based on our own and our children’s needs. But why worry about tropical forests? After all, we are not really dependent on the products derived from them, even if they provide us with for example wood for furniture and medical plants. There are many ethical and practical approaches to answer this question. The ethical aspects are based on some kind of utilitarism, equality, the rights of future generations and even the intrinsic value of nature. And as environmental problems are becoming global, spatial aspects gain an increasing amount of attention. Local processes have global impacts, like for example climate change and vice versa. On the other hand, not only environmental impacts, but also services and goods flow over geographical boundaries. Reasons for lack of sustainability are multiple, and there are both external and internal ones (van den Bergh, 1996). External reasons can be natural - like climatic extremes, natural catastrophes, or pest outbreaks, or anthropogenic, like air pollution or climatic change. However, the definition means that they are not directly connected to local management. Internal reasons rise from political and economical failures, for example poverty, corruption, lack of legislation or participation on local level, ineffective governance, failure to recognise multiple values of the nature or perverse economic incentives. Also lack of ecological, economical or social knowledge can lead to lack of sustainability (van den Bergh, 1996). Most of these reasons are connected to complicated social and political problems, and the solution is difficult to reach because it often demands interference in other countries' politics. 10 Attempts to do this have been done by several conventions concerning sustainability, and the most important is certainly the Convention on Biological Diversity that was opened for signing at the United Nations Conference on Environment and Development in Rio de Janeiro, Brazil in 1992. Agenda 21 (as a continuation of the Rio Declaration on Environment and Development), and the Statement of Principles for the Sustainable Management of Forests (made by the Brundtland Commission) were adopted by more than 178 governments (UN, 2002) and several more specific conventions are based on the principles of The Rio Declaration. However, there is often little success in their implementation - especially in many developing countries. Certification is a more economical and less political way to strive for sustainability. Product labels and chain of custody -verification offers individual customers a way to promote sustainability by daily choices and may be a much faster and more effective way of achieving sustainability than political decisions. Careful planning and verification must though be used in order to avoid the same problems that are connected to political measures. Besides, implementation of common principles on local level is very likely to cause problems. II. ABOUT FSC, ACCORDING TO THE FOUNDERS The Forest Stewardship Council is an international non-profit organisation founded in 1993 to support environmentally appropriate, socially beneficial, and economically viable management of the world's forests (FSC International, 2002). FSC was founded on initiative from representatives from environmental organisations, forest owners, indigenous peoples' organisations, and environment certification organisations from 25 countries. 11 II.1 FSC-principles FSC has defined ten main principles that should be the guidelines for the national certification schemes. These principles are: 1. Compliance with the law and the 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. 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. 3. Indigenous people’s rights The legal and customary rights of indigenous peoples to own, use and manage their lands, territories, and resources shall be recognised and respected. 4. Community relations and worker’s rights Forest management operations shall maintain or enhance the long-term social and economic well being of forest workers and local communities. 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. 12 6.Environmental impacts Forest management shall conserve biological diversity and its associated values, water resources, soils, and unique and fragile ecosystems and landscapes, and, by doing so, maintain the ecological functions and the integrity of the forest. 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. 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. 9. Maintenance of natural forests Primary forests, well-developed secondary forests and sites of major environmental, social or cultural significance shall be conserved. Such areas shall not be replaced by tree plantations or other land uses. 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 13 products, they should complement the management of, reduce pressures on, and promote the restoration and conservation of natural forests. FSC also supports the development of national and local standards that implement the international Principles and Criteria of Forest Stewardship at the local level. These standards are developed by national and regional working groups, FSC contact persons, FSC Advisory Boards and National or Regional Offices which work to achieve consensus amongst the wide range of people and organisations involved in forest management and conservation in each part of the world. FSC has developed guidelines for developing regional certification standards to guide working groups in this process. II.2 Certification The certification of a product or production method represents the guarantee that it is manufactured or managed according to certain standards. There are two approaches to forest certification. One is the performance approach, which demands the fulfilment of specific requirements, e.g. a forest must be managed within defined limits. The other is based on management system, which does not have any specific indicators as parts of the standards (it only makes theoretical recommendations). Thus, it operates on a quite general level. FSC is based on performance standards, which are demanded by the FSC and defined by the national schemes. FSC's system for certifying forest management is based on third-party certification; i.e. the certification and authorisation of a forestry operation is carried out by an organisation independent of the created framework (FSC), landowners and other interested parties. This system shall guarantee an independent assessment of forest 14 management. At present, there are eleven international companies that have been approved as certification bodies, i.e. they are accredited by the FSC (FSC International, 2002). FSC accredited certification bodies are required to evaluate both natural and plantation forests applying for certification according to the FSC Principles and Criteria for Forest Stewardship. They are also accredited to verify and certify chain of custody systems for products from certified forests. Certification companies may operate internationally and may carry out evaluations in any forest type. Certified forests are visited on a regular basis, to ensure that they continue to comply with the Principles and Criteria. II.3 FSC-logo Products originating from forests certified by FSC-accredited certification bodies are eligible to carry the FSC-logo, if the chain-of-custody (tracking of the timber from the forest to the shop) has been checked. II.4 Administration The highest deciding organ in FSC is the General Assembly. It includes three chambers: social, economical and environmental, and the voting power is divided equally between these chambers. The purpose of the chamber structure is to maintain the balance of voting power between different interests without having to limit the number of members. If additional members join a chamber, the voting power of existing members declines accordingly. To achieve a balance between different 15 geographic perspectives within each chamber, the voting power is divided equally between “northern” and “southern” organisations. These are organisations representing the interests of developed and developing countries. In effect, there are "northern" and "southern" sub-chambers within the two chambers. Also national working groups and boards are divided into chambers. The FSC board of directors is elected by the General Assembly and has nine members elected for three years. Two of the members shall represent the economic interests and the other seven shall represent social and environmental interests. The directors represent the FSC in public and ensure that the FSC adheres to the Statutes as well as to national legislation. They shall either be members of the FSC or duly designated delegates of member organisations. II.5 Group certification To facilitate the position of individual landowners, a management method called group certification was established by the FSC. The group members are the forest owners that do not hold individual certificates, but as long as they comply with all the requirements of group membership, their forestlands are certified by a single forest management certificate under the group certification scheme. Group certification also takes account of the regional diversity, because biodiversity does not recognise the boundaries of forest holdings. It also enables large amounts of certified timber to be brought on to the markets and thus improves the cost effectiveness (FFCS, 2002). The group entity is responsible to the certification body for ensuring that the requirements of the FSC Principles and Criteria for Forest Stewardship are met in the forestlands covered by the certificate. The group entity may be an individual (e.g. a 16 ‘resource manager’), a co-operative body, an owner association, a forest management company or other similar legal entities with management responsibilities. When a group entity is a membership organisation, such as an association of forest owners, membership of the organisation does not always mean membership of the group certificate. A forest owner or manager may choose not to join, or may be removed from, a group certification scheme, but may remain a member of the organisation (FSC International, 2002). III. THE FRAMEWORK FOR FSC In order to understand the appropriateness of forest certification we need to establish the general framework for this process: the present situation of forests and of attitudes towards forests (including conservation, use and management). There are a number of areas where finding adequate indicators and establishing appropriate standards and principles are subject to intense discussions. Forest issues can be addressed from different scientific fields’ points of view – Ethics, Anthropology, Biology, Political Science, Law, Economics, Medicine etc. In setting and implementing the standards and principles, the certification process must take into account all these aspects in order to accomplish its objectives. In what follows we will try to get a view of the complex issues connected with forest use and conservation, as well as of the steps that human kind tries to take on its way to sustainable forest management. 17 III.1 Forest-related Social Issues When talking about forest management it is most important to analyse the driving forces inter-playing in this process. In order to do this, we must consider the ethical and anthropological factors that intervene in human actions. Attitudes towards environment have changed throughout the history. People's actions have been dictated by currents of thinking like development ethic (which states that nature is for people to use), preservation ethic (which admits nature's value in itself) and conservation ethic (which mediates between forest and man by means of sustainable use of the former by the latter) (Enger & Smith, 2001). The relationship man-forest has always been governed by the results of the negotiations on value. In making economic decisions, something of value must be sacrificed in order to get the object of choice. The total economic value can be defined as the sum of use value and passive-use value (US Department of Commerce, 1993). The former is experienced by those who actually use the forest, while the latter designates the existence value, the potential future use. The forest is not valuable only in terms of measurable indicators. More and more emphasis has been laid upon its intrinsic value lately. This refers especially to biodiversity (which will be enlarged upon in the Ecological Issues subchapter), to the inheritance to future generations, to health and to leisure. Another controversial factor in the forest-man relationship is represented by the rights to use the forest and its products. Frequently asked questions like "Who has the right to use the forest?" reflect the global concern about social inequities, which derive from this topic. Industrialised countries contain only 20% of the world's 18 population, yet they control approximately 80% of the world's goods and create most of its pollution (Enger & Smith, 2001). The developing countries in turn, in their attempts to rapid industrialisation, destroy forests and trigger a "bad circle" which leads back to poverty. Other problems are related to the differences in political and financial power between those who are actually using the forests. Corporations use political pressure, the timeconsuming nature of legal action and even bribing to reach their goals and avoid compliance with social or environmental regulations and thus creating an even bigger gap between them and the small forest owners/users. The issue of responsibility is crucial when sustainable forest management is desired. At the global level, responsibility awareness developed in the last decades and this reflects itself in the number of conventions and treaties in which the states try to work together to solve forest-related problems. But even if the ethical framework exists, the implementation of the principles is often difficult, if not impossible to accomplish. This is due to the "branching" of the responsibility down to the state level (policies differ from one country to another) and then to the corporate and individual level. Below a minimal level of income, more profit is always preferred to ecosystem health (Holmes & Kramer, 1995). Industrial users of forests seem more concerned about environment nowadays. For some this is the beginning of new corporate ethic, but for others this concern is only rhetoric and social marketing. On the other hand, recognition of individual responsibility should lead to changes in personal behaviour, and that's not something that people readily do. Perhaps one of the most important questions regarding forest use is "Who pays for the losses (in quality, biodiversity etc.), and to whom?" A survey of the political and juridical current answers to this question will be made later on in this project. 19 A forest-related code of ethics should of necessity also include scientific responsibility i.e. all processes should have as foundation sound science (biological, physical and social), transparency and openness to dialogue among researchers, foresters, landowners and the public. III.1.1 Multiple uses of forests Even if the wood material is often the economically most important product of forests, there are a great deal of other products and non-economical values. Hunting is both leisure and a necessary food source, and can be very important in economical terms, especially in European and North American forests. Also gathering of nature products like berries, mushrooms and lichens has a significant economical, cultural and recreational value. In developing countries forest products may offer most people their daily living, but even in European countries their economical value can in some areas be much higher than the value of wood products. In 1997 the Worldwatch Institute reported that the global trade of non-timber forest products amounts to 2,7 billion U.S. dollars/year (International Network of Forests and Communities, 2002). Grazing is especially important in areas where agriculture is not beneficial. Unfortunately, there are lots of conflicts between forestry and other uses of forests. Forest owners often claim that the animals harm the trees and sometimes this really is the case. For example in Lapland, overgrazing has led to erosion, damages of wood and other vegetation (Tiitto, 2001). On the other hand, forestry practices contribute to loss of shelter and food for the animals, reduced recreational value, decline in the amount of berries and mushrooms and possibly their quality if pesticides are used. As the "original" nature is disappearing and urbanisation continues, the interest for the recreational use of nature is growing. On one hand this interest is very beneficial 20 for the nature, because it enhances the knowledge of nature and consciousness of the environmental problems. The recreational value of the forest is hard to measure economically, but it is certainly important for both the physical and the mental health. On the other hand, recreational use can be very harmful to nature. Transportation demands construction of roads, parking lots and resting sites, hiking causes disturbance to the animals and damage to the vegetation. Picnic-places become full of garbage and careless handling of fire may cause serious fires. Overenthusiastic nature lovers may collect endangered species or disturb their breeding. III.1.2 Local communities The relationship to forests varies greatly between different peoples. In most of the developed countries people are becoming aware of the loss of forests and the resources connected to them, and lots of effort is done to protect them. Actually, since there is no need for more agricultural land, the forest area of Europe has been increasing during the last few decades (Enger & Smith, 2001). But most of the untouched, natural forests are lost, as well as bears, wolves and other animals that could be regarded as dangerous. The remaining areas have now both an economical and a recreational value for the urbanised citizens. In many developing countries the relation to forests may be different. Although forests may be important as traditional sources for living, like herding, gathering and hunting, they are being replaced by modern ones. As the population in many developing countries keeps growing, people are forced to move to other sources of income, like for example agriculture. The forest is regarded as a hinder, and many people are happy to get rid of it. The forest has always also a cultural meaning to the people. For some it may be a sacred place, but often it is also regarded as very 21 dangerous because of all the wild animals and the diseases coming from it. Thus, some indigenous peoples may be very enthusiastic about cutting the forest. A common prejudice is that local people usually exploit the forests carelessly and unaware of sustainability, but many recent studies show the contrary (FAO, 1990). Most local people have a lot of knowledge about sustainable harvesting methods and the suitability of different species of wood for different uses. However, this knowledge is used too rarely. First of all, in times of resource shortage the need will override any knowledge and consideration of sustainability. Secondly, forest management is moving more and more out of local communities. It has also been showed that careless misuse occurs more frequently when one is outside one's own territory (FAO, 1990). Thus, if the indigenous people do not have tenure to the land, they might not be interested in preserving it. Problems have been recently raised also regarding the fact that chemical and medicine factories have been using the local knowledge about medicinal plants or other useful substances for centuries, without the recognition of the local people’s discovery “licence” and of the financial rights deriving from this. Closest example of conflicts between indigenous peoples and forestry is the Sámi people in northern Sweden, Norway, Finland and Russia. Although tourism is a growing source of income in the area, the main sources of living are still reindeer grazing and gathering of forest products. Forest is also a significant part of their culture, even if they live quite much like the main population nowadays. The Sámi claim that they are the legitimate owners of the land, but the governments do not recognise these claims. There is no legislation ensuring the Sámi an access to reindeer grazing land, and also other people are allowed to have reindeers, which increases the competition for the remaining land. There are also historical inequalities 22 and language problems that upset many Sámis. Due to all these conflicts, the Finnish Sámi parliament has stated that the rights of the Sámi as an indigenous people are not fully realised in conformity with international human rights agreements (Tiitto, 2001). Of no little interest are also the workers' rights issues. In its Declaration on Fundamental Principles and Rights to Work, ILO (The International Labour Organisation) has established principles that all members, even if they have not ratified the convention, have to promote. These principles include the freedom of association and the effective recognition of the right to collective bargaining, the elimination of all forms of compulsory labour, the effective abolition of child labour and the elimination of discrimination with respect to employment and occupation (ILO, 1998). Almost all countries are members of this convention, but, however, many of them do not implement these principles in practise. There is a lot of discussion going on even in the developed countries about equality concerning gender, right to work and health and safety. In many of the developing countries these are minor problems compared to for example child labour, lousy working conditions and wages. Employment is an important factor preventing social inequalities, not only poverty. It is becoming a very important issue also in industrialised countries, where production is moved to big factories in cities. Employment gives people a possibility to stay in their home region and is an effective means to prevent criminality. For this reason local production should be emphasised, but unfortunately the opposite is happening in most of the countries. For example in British Columbia, 94% of the forests are publicly owned, but logging rights have largely been turned to private companies. Even though the volume of wood cut has increased, the employment has been in 23 decline for several decades. Many forest-dependent communities are in crisis, but forest companies remain profitable (International Network of Forests and Communities, 2002). Education is very important on the job market and it is often offered only in big cities, which are unavailable or too expensive for local people. Lack of knowledge about forests may lead to unsustainable use of forests by logging companies, public and local people. III.2 Ecology III.2.1 Biodiversity There are many levels on which the biodiversity or its loss is being discussed. From a very selfish point of view, biodiversity can be considered as a "gene bank" providing us with useful crops, medicine plants and animals and sources of useful genes for gene technology. Although it does not sound like a very noble purpose, this has still a great value and may also reach the attention of those who do not see the intrinsic value of the forest. Biodiversity can also be appreciated by its ecological value, based on an idea that there are especially important ecosystems or organisms. The extinction of these could have devastating effects on a bigger scale, varying from change in ecosystems to even global changes. A third approach is totally ethical and independent of economical or social values, and it is based on the idea that every species has an intrinsic value, and the human kind has no right to drive other species to extinction. Humans tend, however, to pay most of their attention to more obvious species, like big mammals and birds that may not be keystone species at the ecosystem level. 24 Extinction is a natural phenomenon, but nowadays species are disappearing at 50-100 times the natural rate, and this is predicted to rise dramatically (CBD, 2002). While poaching of big animals draws most of the attention, fragmentation, degradation and loss of habitats are the main reasons for most of the losses in biodiversity. Especially many forest species are endangered due to the increased use of forests and high species diversity in the tropical forests. The World Conservation Union (IUCN) estimates that 75 % of mammal species, 67% of reptile species, 44% of bird species and 12% of all plant species are threatened by the loss or degradation of forest habitats (IUCN 1996, IUCN 1997). When discussing loss of biodiversity, tropical forests usually draw most of the attention. This is no doubt justified, because first of all, they have a greater species diversity than any other ecosystem and secondly, they are disappearing rapidly. Tropical forests in Latin America are being deforested at a rate of 0,6 % per year and those in Asia at a rate of 1% per year (Enger & Smith, 2001). Another reason for worrying especially for these forests is that complicated social and economical factors are connected to the use of tropical forests. However, although the forest area in Europe is actually increasing, it is mostly due to plantations with very little amount of biodiversity (Wahlstrom et al., 1996). Factors that influence biodiversity The energy used by forest ecosystems is derived from the sun, and therefore the biodiversity is greatest near to the equator, where sunlight is most abundant (Wahlstrom et al., 1996). A sufficient amount of water is also needed, and that's why the diversity of deserts if very small although they receive much light. On the other hand, too much water combined to low rates of evaporation can cause too wet conditions and cause the formation of wetland. Humans influence the weather 25 conditions both globally by contributing to greenhouse effect and regionally by changing the vegetation and watercourses and thus the rates of evaporation and soil water content. Stability and the stage of succession influence species composition significantly. Tropical rainforests are a good example of extreme stability, where annual and daily variations in temperature, humidity and vegetation are extremely small. However, they consist of variable microhabitats with a huge amount of very specialised species. On the other hand, in some forests, natural changes like fires and storms create conditions for a variable species composition (Wahlstrom et al., 1996). The value of the forest is often measured by counting the number of species, but this can be very misleading. Even if the number of species is great, rare species may be missing. For example, in boreal forests the biodiversity might be big even in young forests, but the endangered species often depend on degrading wood material found only in forests that are old enough, or on burned wood created by fires that are natural to the area. Some researchers assess the biodiversity as a function of species richness, rarity and vulnerability (Kangas & Kuusipalo, 1993). Plants also need nutrients, and usually areas rich in nutrients have great species diversity. In tropical forests the cycling of nutrients is very important, and most of them are bound to the vegetation. After deforestation, only nutrient-poor soil vulnerable to erosion remains, and a growth of new forest with the same level of biodiversity is often impossible. On the other hand, some ecosystems are naturally low in nutrients, and serve as a habitat for species that are adapted to these conditions. They may be dependent on the absence of better competitors of light and water that start dominating if provided with sufficient amount of nutrients. 26 Another factor influencing the species diversity is the area of forests, which should be taken into consideration when planning conservation and forestry. Even if a certain amount of forest is left untouched, it may be so fragmented that the individual plots are not big enough for some species. Again, the fragmentation may enhance the number of species by offering a large amount of edge areas with many species, but these species may not be valuable from a conservation point of view. The area required by a species depends on size, breeding and feeding habits, territorial behaviour and possible migration of the species. Usually a big, round-shaped area is better than many small fragmented areas. Also "ecological corridors" are important for the dispersal of the species (Primarck, 1993). Roads constructed for forestry use may often cause more damage than the real forestry practice. For example in southern Finland, forest roads cover an area which is double compared to the area of nature conservation areas, and their total length is enough to go three times around the world (Wahlstrom et al, 1996). Also telephone lines and high voltage lines can fragment forest areas. III.2.2 Soil and water bodies The influence of forests on both the hydrology and the chemical characteristics of streams, lakes and groundwater is of great importance. Forests effectively prevent hydrological extremes, such as floods, erosion and the eutrophication of surface waters. Forest vegetation binds nutrients and soil effectively and reduces the amount of evaporation, and therefore practices that affect the hydrology and material balances of the soil, e.g. cutting, drainage, fertilisation and scarification, will also affect the water bodies. 27 Natural leaching of phosphorus and nitrogen from untouched forestland is fairly insignificant in boreal forests, but it can be remarkable on fertilised areas. For example in the river Simo in northern Finland, the contribution of forestry to nitrogen loading has been estimated to be of 35% and that of phosphorus of 45% (The Environmental Administration of Finland, 2002). The fertilisation of European forests has decreased markedly during the 1990's, but it still contributes to eutrophication. In tropical forests the situation is different. The major part of the biomass, and thus nutrients, is bound in the vegetation, and if the trees are removed, the rain rinses away also the rest of nutrients as well as huge amounts of soil. The growth of similar new forest is often impossible. Draining influences the water level of both forested land and water bodies near to it. This causes changes in the soil oxygen content, which affects the microbial activity and the species composition. When the water level is lowered, aerobic bacteria and fungi start dominating and the composition of dead material increases. This of course influences the soil fauna remarkably, but more obvious effects can be seen in the vegetation: trees that are sensitive to too much humidity start dominating and shadowing smaller bushes and grasses. From the viewpoint of forestry, this is of course desirable, but it may reduce the biodiversity and variability of landscapes. Draining also increases the leaching of nutrients to water bodies although the nitrogen and phosphorus absorbed on suspended solids have less adverse effects than if soluted (Kronvang, 2000). III.2.3 Pesticides 28 Until recently, the goal of forestry has been to reduce the biodiversity of the forests to facilitate harvesting and reforestation, and to fight against pests and diseases. However, in a forest with only one or a couple of species and very homogeneous wood material, the diffusion of pests is remarkably facilitated and huge outbreaks of pests can destroy the whole wood production. Weeds harm the reforestation by shadowing small trees and providing some pests, like for example small rodents, with shelter. Therefore also herbicides are widely used in forestry. Pesticides are not usually very target-specific. The developers of insecticides have to work hard to compete with new, resistant forms of the pests, while many beneficial insects and soil decomposers suffer from the already existing pesticides. Many chemicals also have a serious negative impact on essential soil bacteria and fungi, reducing soil productivity and increasing nutrient loss and erosion. The reduction of plant diversity by herbicides limits the availability of food, shelter and breeding areas for mammals and birds. One of the most important adverse effects of pesticides used in forestry is the leaching to water bodies, where they may immediately affect the species composition, and in the longer run accumulate in the food chain. Chemicals can end up into the sediments and slowly dissolve again after long periods. The pesticides used in forestry also have serious negative health consequences for humans. In addition to acute toxic effects, many pesticides have been proved to contribute to increased risk of cancer and neurological problems. The active ingredients in several of the most commonly used pesticides have also been linked to 29 a disruption of the hormonal system in mammals, leading to reproductive problems such as a decrease in sperm amount. III.2.4 Climate The global climate change is connected to almost all other environmental issues and also to forests. Forests affect the climate greatly, both on the local and the global level. They reduce variability in the temperature and humidity, increase the amount of evaporation thus increasing the humidity of air and therefore altering the amount of precipitation even in distanced areas. Forests are also a source of aerosol particles that act as condensation nuclei in cloud formation. In this way they may affect the global climate significantly. The common idea of tropical forests as "the lungs of the Earth" is quite wrong, because it is nowadays actually estimated that they are mostly a CO2-source. (Lawesson, 2002) However, huge amount of carbon is bound in the vegetation, and if the forest is cut without a proper reforestation, the carbon is released. Boreal forests are usually a CO2-sink (Lawesson, 2002), but the greatest potential of binding CO2 is limited to the period of rapid growth. From this point of view a fast growing, productive forest is better than an old, preserved one. It has been discussed a lot whether the net CO2-loading from drained wetlands is positive or not, because the growing forest binds CO2. In addition, less methane is released from drained forestland. On the other hand, if the drainage is not well planned, it may lead to weak forest growth and great CO2-emissions due to increased decomposition of organic materials. For this reason it is difficult to estimate the influence of draining to the global climate change (Wahlstrom et al., 1996). 30 On the other hand, the climate affects the forests as well. The type of forest depends mostly on the humidity and temperature, and may be greatly altered by the climate change. This has of course happened many times during the history of the Earth, but never before at this rate. The speed of the warming is so great, that it may drive many species to extinction or at least to the brink of it. And combined to other threat towards forests, the effects may be devastating (Enger & Smith, 2001). In boreal forests predicted warming, increased humidity and the increase in the CO2level will actually probably increase both the productivity and the biodiversity. However, this can happen at the expense of the indigenous species. And even if the other conditions change to a more convenient direction, the amount of light does not, and this may limit the species ability to move to new areas. In tropical forests the effects are predicted to be more immediate; the amount of precipitation is estimated to reduce markedly, which would turn them into a totally different type of forests or even to savannahs or deserts. III.2.5 Genetically Modified Organisms (GMOs) There are many benefits and hazards connected to the use of GMOs in forestry. Environmental and economical benefits include increased productivity and resistance to drought, salinity and pests. This may help to reduce the use of pesticides. Also the structure of wood material can be modified to be more suitable for the use, for example the amount of lignin can be reduced when producing wood for paper industry (FAO, 2001). This saves lots of chemicals used in the processing. Hazards, on the other hand, are also multiple. Reduced diversity in clone forests lowers also the diversity of other species and reduces also the esthetical value of the forest. Lack of genetic variation reduces the adaptability to environmental stress and 31 sudden catastrophic events like pest outbreaks. However, what concerns most people, is uncontrolled spread of GMOs. Sterilisation is not a 100% sure solution to this, because plants can reproduce also vegetatively. Besides, sterilisation has a great influence on other species that are dependent on the seeds, nectar or pollen of the trees. Modified wood material might lead to changes in the soil structure and microbes because of difficulties in degrading microbe-resistant material. Also social issues are connected to the use of GMOs: social inequalities might rise from high costs and limited availability (FSC international – decision on GMOs, 2000). III.3 Forest-related political and legislative issues Rapidly evolving international economic relationships, such as trade liberalisation and the dynamic movement of capital and corporations across borders, and above all, national policy concerns, continue to drive national policy agendas. All these require new modes of decision-making and more collaborative approaches. At the government level, this translates into a necessity to use power to facilitate and to shift from prescribing behaviour to supporting responsibility by creating or developing regulations, creating incentives, monitoring processes and providing information. If the 20th century was dominated by a “reactionary” policy style, its end and the beginning of the 21st century are marked by a relative tendency to anticipate future environmental problems and to act in such a direction as to minimise the environmental and financial debt of generations to come. During the past few years, policy analysts have discussed about the underlying causes of deforestation, the effects of trade liberalisation and the impact of structural adjustment policies. The results differ from case to case: just thinking about trade 32 liberalisation, one could argue that it can encourage unrestricted operation of transnational forest corporations that do not use economically and environmentally sustainable methods of production, but also that this could lead to economic expansion and consequently to more support to sustainable forest management. The same duality is highlighted regarding economic adjustment programmes: do they lead to unemployment and to unsustainable use of forest resources or to improved longterm environmental management? The situation becomes even more complex due to the fact that other inter-sectorial policies do not mind the forest issues. The translation of policy reforms into practice is made mostly at the legal and economical level. The economic issues will be considered in the next subchapter. As a consequence to the recent policy and institutional developments, a significant acceleration in the revision of forest-related laws takes place. While moving away from a regulatory approach focused primarily on government management and policing of forests as economic resources, forest law increasingly recognises the interests involved in or affected by forest management and the environmental and social roles of forest resources. It also relies more and more upon a range of public and private actors (FAO, 1999). Many new concepts and approaches have emerged in environmental treaties, some of the most important being: the principle of sustainability (first expressed directly by the Brundtland Commission), the precautionary principle (first expressed in the Framework Convention on Climate Change, art.3 no.3), the polluter pays principle and the principle of common but differentiated responsibilities (stated by principle 7 of the Rio Declaration). The problem is that all of them lack a clear and universally approved legal meaning (Bugge, 1995). 33 III.3.1 A survey of the international forest regulations The notion of international forest regulations is rooted in two proposals made in 1990: one for a global forest convention, and the other for a forest protocol within the Climate Change Convention. Although UNCED (The United Nations Commission for Economic Development) did not secure a forest convention, it developed several legal instruments, both “soft” and “hard”. The Rio Declaration established general principles for an “equitable global partnership”, Agenda 21 highlighting the crosssectorial nature of forests and their socio-economical as well as environmental values. In addition to soft law instruments, UNCED agreed on the terms of three conventions which are relevant to forests and forestry: CBD (Convention on Biological Diversity), FSCC (The Carbon and Climate Moderation Convention) and UNCCD (The UN Convention on Protection against Desertification). Another option would be the civil society movements, such as forest certification. Although forests fall under the domestic jurisdiction, nations have increasingly acknowledged the “global commons” nature of forests. At the same time, they have to respect the principles of sovereignty and “good neighbourliness”. Cross-border activities such as trade, foreign investment, forest operations of foreign companies, aid and pollution must not create negative impacts in another country. In case they do, the State can be sued. Anyway, cross-border problems have tended to be most effectively addressed through regional agreements. Studies conducted by FAO differentiate four patterns that can lead to the development of an international forest regime. The most general one would be to negotiate a legally binding instrument on all types of forests. Its main shortcoming resides in the fact that it is difficult to reach an agreement on issues that are not considered priorities by some states. These could 34 argue that negotiations would be time and money consuming. The reasonable way of realising this convention would necessitate a gradual filling of the gaps by incorporating new obligations to the already existing legally binding conventions. A second option would be to work through existing conventions and agreements to secure global services and to mitigate harmful cross-border activities: agreements concerning biodiversity (CBD and CITES), wilderness heritage (World Heritage Convention), carbon and climate moderation (FSCC) and the protection against desertification (UNCCD). Although forest is only part of its concern, CBD has many provisions that can support sustainable management. CBD confirms a country’s sovereign rights to access and use of biological diversity and genetic resources in its territory. There are large areas that overlap between CBD provisions and The Forest Principles. FSCC and UNCCD are focused on the forests more as carbon source and sinks or as protection against desertification. ITTA (International Tropical Timber Agreement) is the first agreement to incorporate principles and targets for conserving of resources and has many elements of a legal agreement on tropical forest management (FAO, 1999). The reasons why these conventions are not yet efficient are that the instruments are new and not yet fully operational, while the means of control are very weak. Moreover, differences in political commitment, availability of resources for implementation, effectiveness and equity of obligations and incentives, speed of action and willingness to pay make this agreement very difficult to reach. A third option, relying on the development and elaboration of regional forest related agreements, is promising to be more efficient. This has been demonstrated in the Central America and Amazon countries’ forest agreements, as well as in the PanEuropean process. Representing bottom-up forms of international co-operation, they can create institutional conditions to support long-term investment in sustainable forest management. However, they still need to be integrated in a more holistic legal framework. 35 • What we can also do is to rely on “soft law” and civil society processes. These non-legally binding approaches have proved useful in times of rapid market and social change, and this made them to be the most common choice. Starting as soft law, the Forest Principles and Agenda 21 became landmarks in some national laws and regional conventions. The difficulties regarding their implementation as “hard law” reside in the very fact that they were agreed upon as not being legally binding. An alternative to regulations is offered by the civil society tendency to develop incentive systems for sustainable forestry. These initiatives act as highlighters of both “best” and “bad” practice in forest/forestry activities. The category also includes the forest certification movement, which is largely driven by environmental NGOs, retailers and forestry companies. The IPF (International Panel on Forests) Proposals for Action, representing the product of both nations and civil society, have the potential to become rules for forest related activities. III.3.2 The national level At this level, recent years have witnessed a reorientation that is more pregnant in four fields: local forest management, environmental functions of forests, forest management planning and granting of forest utilisation contracts. After being subverted by the State (which has arrogated the management role to itself by creating State forests) for many years, local forest management is now redeemed by means of the proliferation of new mechanisms for the transfer of rights and responsibilities to user groups, community forestry leases, local communities etc. Principle 2 d) in the Forest Principles (formulated as a result of the discussions following the Rio Declaration) states that: 36 Governments should promote and provide opportunities for the participation of interested parties, including local communities and indigenous people, industries, labour, non-governmental organisations and individuals, forest dwellers and women, in the development, implementation and planning of national forest policies (The Forest Principles, 1992). The growing awareness of the environmental functions of the forests reflects itself in the legislative landscape through the use of new techniques such as inventory, planning and classification provisions or the implementation of environmental impact assessment procedures. The management planning registers an evolution in terms of the necessary range of ecological and social issues to be considered, as well as in terms of the public involvement in decision-making processes. Still, factors like insufficient political will, weak institutional capacity, overburdened court systems, the absence of suitable incentives for participation, poverty and corruption hinder the progress that forest legislation could facilitate for environment and society. III.4 Economical Issues III.4.1 Economic instruments When considering the actual implementation of sustainable forest management, economy eventually becomes a vital factor. Many arguments can be put forward 37 regarding biodiversity, human rights etc. Without considering the consequences on the economy and creating a viable economic solution, it is impossible to reach a point were all groups of people who are affected can reach to an agreement. The Tropical Timber Organisation defines sustainable forest management as: …the process of managing permanent forest land to achieve one or more clearly specified objects of management with regard to the production of a continues flow of desired forest products and services without undue reduction in its inherent values and future productivity and without undue undesirable effects on the physical and social environment (Barbier et al., 1994). A variety of economic tools serving to the implementation of sustainable management of forests have been developed within recent years. With the attention drawn towards sustainable forest management in general and FSC in particular, three main frameworks exist (Enger & Smith, 2001): 1) Information Programs: Information of consumers can create a demand for sustainable products. From a simple demand/supply theory, it would make the market respond accordingly. 2) Performance bond/deposit refund programs: This system is well known from recycling systems for example for bottles, but it is also applicable on forests. Before logging companies move into to an area, a deposit would be placed. Only as reforestation is carried out or sustainable management is practised out, the deposit can be repaid. 3) Subsidies: A certain form of resource use/management can be promoted by subsidies. Different tax forms can be implemented, or tax reductions can be made. 38 The tools mentioned here are called Market-based Instruments. The more traditional instruments are Command and Control. Shortly speaking, the difference is that Command and Control legislate and dictate how management and production must be carried out. Market based Instruments are working as incentives to a more sustainable production, from the simple point of view that the “better” your production is, the less you have to pay/the sooner you have your refund back. Command and control are carried out in many countries, for example as complete logging bans. The success of this method of protecting the forest varies. Very good results where forest has been preserved and local benefits have been visible have been obtained, but in other countries logging ban has created even bigger problems with illegal felling, hunting and unemployment as consequences (FAO, 2001). III.4.2 Cost-benefit analysis To analyse whether an economic implementation is an overall expense or benefit, cost-benefit analyses are made. This type of calculation takes all the monetary figures and gives a net result, which will be used in decision-making. If the net result shows that the impact will be overall positive, implementation can take place. A major problem for these calculations is that they only consider what is monetary. Many subjects cannot be priced, such as leisure and biodiversity. A loss in biodiversity can be irreversible, and cannot be counteracted by an economically gain from converting forest into farmland. III.4.3 The issue of under-pricing of forest products A general problem is the under-pricing of resources, which is widespread in the production of log and other forest products. The price of these products does not reflect the actual price of producing them. The price is often determined by the 39 subsidies, which facilitate the production in different ways, for example by a tax reduction on transport, low price on electricity, easy access to land etc. The final price is then the actual price minus the subsidies. The price of forest products is further a “private price” - a strictly cost of production based price. No externalities are usually taken into consideration, such as biodiversity loss, leisure, climate, recreation of resource etc. The above-mentioned economical instruments indicate that creating a sustainable forest management is indeed possible, and could be implemented just by using them. The problem, of course, is much more complicated. In order for sustainable timber management to be a viable forestland use option, it must yield net returns that are greater than those derived from competing ones, for example agriculture. This is especially important when considering developing countries. A simple formula describes this relation: NPVA < NPVF, where NPV represents the net present value and A and F designate forest and agriculture (Barbier et al., 1994). FSC principle #5 regards the economy of the forest, and states that economic viability should be encouraged by using multiple products and services (FSC International). Whether this is practically possible will be discussed in Chapter IV. III.4.4 The issue of the Tragedy of Commons The “tragedy of commons” has at its roots the fact that things that are not owned by any person or nation are regarded as something that should be used as much as possible, since someone else might take advantage of them instead. This could be a single person, company or country. A good example is the air or the fish in the 40 ocean, both of them continually being “hot” topics. The problem exists regarding the forests as well, especially in the tropical forest regions. Tropical forests are often owned by the state, and concessions are given to log-companies for short periods. This gives no incentives for careful managing of the forest. Therefore it is important to define the rights of the land. Further, the period of concession should be long enough to enable the implementation of long-term sustainable management systems. If a concession is only given for a few years and no responsibility after this period is demanded, it becomes very easy to overexploit the area, only to move afterwards to the next concession in another area. Good experiences have been reached in Gambia with community responsibility instead of government responsibility in connection with forest fires. After moving the responsibility to communities, fires were almost completely reduced (FAO, 2001). This method might prove useful in a more general matter, i.e. sustainable management. It can be rather difficult to define long-term land rights, because of relative short governing periods, usually of 4 to 5 years. Many less developed countries are looking for quick capital, instead of maintaining long-time value. III.4.5 Could trade barriers solve the problem? Trade of log is not as significant a factor regarding deforestation as many would think. For example only 17% of non-coniferous tropical round wood is used for industrial purposes. Of this only 31% is exported, which gives only a total of 6% export (Barbier et al., 1994). Logging is an important player in opening up the forest for other purposes that lead to deforestation. But with the relatively low part of the wood actually being exported, trade barriers are unlikely to be a strong tool. Increased trade could rather be used as an incentive for introducing better management, especially if there is a market for the products. 41 Non-timber products may be a strongly underestimated resource. The value of nontimber products in Indonesia was in 1985 US$ 150 millions, comprising 12% of total export gains from forest. It has been estimated that this amount could be even bigger, since there has been less focus on using other products than wood (Barbier et al., 1994). 42 IV. A DISCUSSION ON FSC IDEOLOGY AND PRACTICE IV.1 FSC on the map Figure 1: (Source: Certified Forests, www.certifiedforest.org) Until now, about 29 million hectares of forest has been certified by the FSC in 56 different countries. A quite big share of it is done in Sweden (35%), the Poland area (14%) and USA (12%). For comparison, certified by Pan-European Forest Certification (PEFC) is about 43 million hectares. 51% of it is located in Finland, the rest in six other certified European forests countries. The area of third party under the Sustainable Forestry Initiative (SFI) is 30,6 million acres (about 12,4 million hectares) (Meridian Institute, 2001). We will enlarge upon other certification systems in chapter V. 43 The FSC is the only worldwide forest certification initiative, and therefore problems can be expected in the implementation. The certification of both boreal and tropical forests has received lots of criticism, and their importance has been questioned. There have also been discussions about the inequalities between the developing and the developed countries' ability to comply with the principles and criteria. According to Kircodan, a Danish furniture selling company that partly uses tropical wood, it is much cheaper to certify boreal forests than tropical ones, because they do not host such a big biodiversity and because tropical forests include so many microhabitats. This is claimed to cause inequality (Kircodan, 2002). This is an interesting argument, because even if the statement about the biodiversity is right, it does not mean that the diversity or variability is small in the boreal forests. Kircodan also claims that there is actually no need for certifying European forests, because they are managed so well and the national laws cover the area well enough (Kircodan, 2002). However, since there are hundreds of threatened or endangered species in European and American forests, environmental NGO's have a different opinion about this. Still, inequality can be an important issue. In developing countries, the decisions are often influenced by real needs, not just preferences. It is often easy for a wealthy European to choose a little more expensive, sustainable produced goods, but if one has to worry about the daily living of the family, it is difficult to accuse one for shortterm solutions. There is also much more knowledge about boreal and temperate forests, and the education and forest management are already advanced. Requiring the same from developing countries may be considered as a new form of imperialism, especially because it is often the foreign companies that get the profits of forestry. 44 When considering the certification of tropical wood, Kircodan states that the FSC is trying to sell something that does not exist. This is based on their own information, stating that less than 1,5 per mille of all tropical forests is FSC-certified and this is not enough to cover the demand. If consumers buy only certified wood, people in the tropics are forced to turn their forests into more productive plantations and agricultural land. Therefore, Kircodan accuses the FSC for harming the people's living and destroying the forests totally (Kircodan, 2002). There are also criticisms on the importance of certification because it covers only a minor part of the world’s forests, especially tropical forests. The FAO estimates that the area of certified forests represents only about 2% of the total area of the world’s forests (FAO, 2001). However, the area of certified forests is growing in all kinds of forests. Figure 2: (Source: Certified Forests, www.certifiedforest.org) 45 IV.2 Problems of certification Certification was created as a tool towards sustainable development, but its results are still debatable. For example FAO views certification very critically and points out some unresolved issues. The connection between certification and improved forest management has not been proved in the areas where deforestation is greatest – in the developing countries. FAO is also concerned about the lack of knowledge about the marketing impacts of certification and the possibility that certification will, intentionally or not, create trade barriers (FAO, 2001). Another major concern regarding certification is that if the consumers stop buying non-certified wood, forest growers in the developing countries that cannot afford the certification might turn their forests to more profitable farms and plantations (Kircodan, 2002). For this reason, FSC is also accused to harm small forest owners and even endanger local people’s living (Kircodan, 2002). Like in other regulation measures, transparency remains a problem. The timber is often sold and transported several times before reaching the consumer, and the chain of custody may be very difficult to prove. Mismanagement and illegal logging happen even in certified forests (Freris & Laschefski, 2001). Problems in verification cause extra costs to the producers and can be quite confusing to the consumers. One of the most often used arguments against the efficiency of certification is that it would solve only a minor part of the problem. As FAO pointed out (FAO, 2001), the major reason for deforestation is conversion to agricultural land or pasture. Further more, only a minor part of the wood products is exported and used in products that can be labelled. It has been estimated that only 6% of the cut tropical wood is exported (Barnier et al, 1994). The reasons for forest degradation are often based on 46 other reasons than forestry, like overgrazing, illegal activities, mining, oil drilling and external causes like air pollution. The potential of certification to influence these factors is small (FAO, 2001). Certification is sometimes also claimed to be a short-term solution. Freris and Laschefski (2001), for example state that it only works when guaranteeing maximum profit for the logging company, but if certified timber loses its commercial advantage, the production will move back to more predatory practices. Therefore, they advice consumers to boycott all tropical timber exploitation and the state to invest in command and control governmental measures. Kircodan is also suspicious about the consumers continuing interest in certified products (Kircodan, 2002). It seems though that eco-labelling is not loosing ground. Although the initiative of actually formulating an environmental policy and of having arguments for the choice of not adopting the FSC certification is welcome, the problem is that Kircodan do not use sources to back-up all their assumptions. They also seem to offer only the information that supports their opinion. In the abovementioned argument regarding the actual amount of tropical wood used for labelled products, Kircodan only give the per mille for furniture production, not taking into account the fact that there are many other areas using products from certified forests (the paper industry, the construction field or the actual consumption of non-timber products). FSC is the only worldwide forest certification initiative, and therefore it perhaps has to face more challenges than the other certification programmes. Special problems concerning FSC-certification will be discussed in the following text. 47 IV.3 The structure of FSC As mentioned earlier, the highest deciding organ of the FSC is the General Assembly, where the voting power is divided equally between environmental, social and economic chambers. Also the national councils include three chambers. Compared to other certification systems, the non-economical sector is quite powerful, especially considering the fact that the certification system is market driven. For example in PEFC, non-governmental organizations may only become extraordinary members without voting rights of the council. Also the SFI is mostly governed by the industry. From a structural point of view, FSC is thus the only system that applies the Agenda 21 prescriptions regarding sustainable management of natural resources, i.e. the necessity to give equal consideration to environmental and social issues. This goes from the decision-making organ (the board) down to the practical implementation bodies. A common claim is that FSC acts in favour of the developed countries (FAO, 2001, UNEP, 2002, interview with Jimmi Enevoldsen, 2002) because most of the certified area is located in them. But when considering the structure of the General Assembly, this claim is incorrect. The voting power is divided in each chamber between the "northern" (representing organizations with interests in the developed countries) and "southern" (representing organizations with interests in the developing countries) members i.e. different viewpoints are balanced. Accreditation and certification As we have seen, the FSC both sets the standards and acts as an accreditation body. This has caused some critique, because according to the International Organization for Standardisation (ISO) 61 guidelines accreditation bodies "shall not offer or 48 provide, directly or indirectly, services to design, implement or maintain a certification scheme" (PEFC, 2002). This means, that a clear separation should be established between setting of standards, accreditation of certification bodies and settlements of disputes (CEPI, 2002). All accredited certification bodies may operate internationally and may carry out evaluations in any forest type. In order to make sure that adequate knowledge is available, local experts are often consulted. In developing countries, however, sufficient and reliable expert help might be difficult to gain. The impartiality of the certification bodies may sometimes be questioned, because they have economic interests in the certification. They receive money from the forest owner/ manager for every certification and inspection they carry out, and it is in their interest to maintain the forests certified. This might lead to malpractices or too loose interpretations of standards. However, like in any business, this would contribute to loss of credibility (Peter Feilberg/NEPCon, 2002). One would expect the certification bodies to be motivated by this, since lowering FSC's credibility would be putting themselves out of business. IV.4 The implementation of the FSC-principles The principles of FSC seem to cover all sectors of sustainable forest management, but how do they work in practice? Some of them rely greatly on national legislation or international agreements, which does not always guarantee good management. Also others require effective governance and control, and there is still room for interpretations. Here the national schemes and certification bodies have a crucial importance, though they are supervised by the FSC. 49 IV.3.1 Social issues A Social Working Group was established to address social issues within the FSC, and The II Annual Conference "Certification for the People", held in Nov. 2000, focused exclusively on social issues (FSC International, 2002). Topics like the rights of indigenous peoples, forest workers, and other people dependent on the forests are very widely covered in the FSC-principles 3, 4, and 5. According to the criteria, forestry should promote employment and economical sustainability and thus possibility for the local people to stay in the area. This should be done via supporting education, preferring to hire qualified local workers and raising public awareness. Management planning should incorporate the results of evaluations of social impacts. Laws and regulations concerning the health and safety of the employees and their families should be followed, as well as the ILO convention prescriptions (ILO, 1986). There are several problems with the implementation of these principles and criteria. First, compliance with national laws and international agreements does not necessarily guarantee good forest management because of lacking regulation in some countries or weak governance and control. As discussed before, membership of the ILO convention has not solved inequalities in the labour market. Supporting local employment and production can be considered to prevent free trade and mobility of labour. The third principle deals with the rights of the indigenous peoples. The criteria for this principle include that indigenous peoples control forest management on their lands and territories, sites of special cultural, ecological, economic or religious significance to indigenous peoples are recognised and protected. Indicators of compliance with the principle are the participation of the local people and an 50 authorizing position of a tribal body in the decision-making. In theory, this gives the indigenous people a crucial position in the forest management, but problems rise from tenure issues. Often the land belongs to the state or industrial owners, which are not willing to give up their rights. Even in Finland and Sweden, there are serious conflicts about the ownership of the reindeer herding areas. Indigenous peoples shall also be compensated for the application of their traditional knowledge. The verification of this may be difficult, because the value of knowledge is difficult to measure. IV.3.2 Environmental issues IV.3.2.1 Biodiversity The conservation of biodiversity is mainly included in the FSC-principles 6 and 10. Measures to implement the principles are defined in national schemes and include for example requirements for maintaining a certain amount of natural forest, old trees and habitats of endangered species. Hunting and gathering can be restricted and monitored (FSC Sweden, 1998). Plantations should complement the wood supply of natural forests and help to preserve them. However, natural forests should not be turned into plantations, and this kind of plantations that have been established after 1994 cannot generally be certified (FSC International). IV.3.2.2 GMOs The FSC has concluded that the risks of the use of GMOs exceed the benefits, and therefore the sixth principle bans their use. The Council defines a GMO as follows: A genetically modified organism means an organism in which the genetic material has 51 been altered in a way that does not occur naturally by mating and /or natural recombination or both. Thus, this definition excludes hybrids formed by natural processes, natural breeding, vegetative cultivation and even cell fusion if it is not produced by GMO techniques or if it could be produced by “traditional” breeding methods (FSC International - decision on GMOs, 2000). IV.3.2.3 Pesticides According to a FSC report, the use of pesticides could be reduced remarkably via careful forest management (FSC International decision on Pesticides). For example the amount of weeds is highly dependent on felling methods. Clear cutting often creates conditions favourable to weeds, as there are no trees shadowing them. Diseases and insects can be controlled by avoiding overstocked stands, maintaining a sufficient amount of variation at both the species and the age level, and by removing affected trees (FSC International - decision on Pesticides). It is also stated in the report that integrated pest management (IPM) should always be a part of forest management. IPM includes four major parts: knowledge about the target organisms biology and population dynamics, monitoring, assessment of the acceptable injury and action threshold levels and employment of an acceptable population control method (Begon et al, 1996). This method should as often as possible be non-chemical, and pesticides should be used only in critical cases and only temporarily. A situation when pesticides may be needed might for example be due to degraded land condition or a severe catastrophic event. Even when the use of pesticides is acceptable (which is decided by the certification body), there are special conditions to be maintained. The effect of the pesticide should be restricted to the target organism, buffer areas should be left to protect water bodies and human habitation, and neither wildlife nor indigenous and recreational food sources should 52 be influenced. The FSC also bans some pesticides totally taking into consideration factors such as their toxicity (both acute and chronic), persistence and bioaccumulation. Based on these criteria, for example all chlorinated hydrocarbons (except those that contain nitrogen or phosphorus) are banned. IV.3.2.4 Soil and water bodies According to the sixth FSC –principle, forest management should conserve water resources and soils. The implementation of the principle may include for example the use of buffer zones where no forestry practices take place. Also draining can be restricted or banned, and the use of fertilisers is allowed only if the need for them is proved by soil analysis (FSC Sweden, 1998). IV.3.3 Laws and politics Legal issues are mainly covered by the principles 1 and 2. The first principle requires the national laws and international treaties and agreement (to which the country is a signatory) to be followed in the forestry and the second requires the verification of tenure and user rights. Laws dealing with forestry can be found in environmental, economical, social and administrative sectors. The environmental sector includes laws about forests, protection of water bodies, soil, species and environment in general. Also chemical laws and laws concerning GMOs can be essential. On the administrative level there are laws concerning tenure and user rights, planning, environmental impact assessment (EIA) and constructing of roads etc. The economical sector is dealt with in forestry acts, regulation of possible funding and book keeping. Social issues are included for example in laws covering the rights of indigenous peoples, labour, 53 multiple uses of forests (for example hunting laws) and cultural preservation. Unfortunately, this sector is quite often under appreciated or even ignored in the legislation of the developing countries. Significant international agreements include for example the CITES (Convention on the International Trade in Endangered Species of Wild Fauna and Flora), ILO (International Labour Organisation) convention, ITTA (International Tropical Timber Agreement) and several conventions concerning biodiversity. Principles 1 and 2 may seem to be quite easy to implement, because they only require compliance with laws and are therefore quite unambiguous. In practice, however, they do not always guarantee a good forest management. Especially in many developing countries the legislation of these sectors might be weakly developed, and there may be lack of effective governance and control. Therefore compliance with these principles may be very difficult to show, which may render the certification procedures. IV.3.4 Economic issues Economical issues are mainly considered in Principle 5. In more detail, it requires the forest management to be economically viable in long run also, to promote the multiple uses of the forests and local processing of the timber. These can be controlled by requirements for a forestry plan, book keeping, regional plans and regular inspections. The implementation and supervision may again be quite easy in Europe and North America, where proper regulation, knowledge and possibly also subsidising systems for forest management already exist. For example in Finland, several forestry centres 54 and -communities control, advice and subsidise private forest owners and detailed plans submitted to the governing bodies are an important part of the management. However, in developing countries there is often lack of regulation, governance and knowledge for this, and any financing can hardly be expected at least from national bodies. In the Northern hemisphere countries the implementation is more a matter of will rather than a matter of capability, that determines if FSC is being deployed on the forest. Both huge forest areas owned by corporations, state or private persons and group certification for small forest owners are carried out with success. Especially the recent development in group certification is promising, allowing also small forest areas to be certified, at relatively low costs. This is done in different ways: An organisation having many smaller forest owners as members can obtain the certification, and offer it to the individual forest owners. Also forest owners can create a community with the purpose of certifying their forest, sharing the expenses. The group holding the initiatives may later expand, by letting other forest owners become a part of the community. This way of certifying strongly reduces the cost. In Denmark and other Western European countries the whole forestry sector has been in a long crisis, due to historically low prices on coniferous as well as broadleaved log. Whether FSC can be the economical saviour or not is not clear. For a forest owner, the risk of investing money at a time when economy is already at its strains is too big, as long as no security and guarantees are provided. There are several cases around both the Western European countries and the eastern European countries as well, of certifications that have been paid back within in a short period, due to higher price on timber. Some forest owners expect not to be able to receive a significant higher price as more forest is certified, and the market becomes more saturated, but still they have been able to gain from the process of certifying, because of improved management. This is especially the case for smaller forests that are not big enough to afford to employ professional, well-educated personal (Hatzfeldt et al, 2001, 55 interview with Peter Feilberg, 2002). In the more traditional management form, clear cutting is often carried out, and regeneration is done afterwards at relatively high costs (app. 25-35.000 DKr per hectare). The management form often used under FSC uses self-regeneration, which reduces these costs dramatically. Self-regeneration is also used in some non-certified forests. In many countries certification has become a very strong emotional and political issue. Having consulted different groups of interest in a wide range of fields including forestry, industry, certifying bodies and NGO’s, and some of the national groups of FSC and PEFC, we ended up in having different opinions on the same issues. Two major reasons are probably in part responsible for this: • Lack of transparency in both FSC and PEFC. • Lack of knowledge about certification and differences between certification processes. Some environmental policies are sometimes based on inaccurate information, and at other times very good arguments were used - both on the pro-s and contra-s of certification as a whole, and on the difference between PEFC and FSC more specifically. Deciding whether certification should be used in general and in particular which system should be implied is rather complicated, given this wide range of opinions, unless one is well informed and able to differentiate between what is a serious and reliable viewpoint and a misinformed, subjective one. Especially consumers that are not professionally involved in certification cannot be expected to see through the – at times – rather confusing debate. Therefore a task for FSC is to become more available and make itself better known as a certification system, both for the forest owners, the industry and especially the consumers. Credibility and information are 56 keywords in this matter. This can be achieved by being open-minded regarding both failures and successes of the FSC system. Further on, the work carried out by the certifying bodies (documentations etc.) and the forests (ex. management plans) themselves should be easily available for the public, thus responding to demands for transparency. IV.4 Who are the beneficiaries? According to the FSC statutes, the Association was created in order “to promote an adequate management of the forests, providing the assistance required to achieve an environmentally appropriate and economically viable exploitation of natural resources, avoiding deterioration or affectation of such resources, of the ecosystems, or of the surrounding communities.” The benefits acquired by managing a forest according to the FSC Principles and Criteria are thus three-folded: environmental, social and economic. From an environmental point of view, FSC certification has to offer: assessments of environmental impacts, requirements regarding the protection of soil, water, air, forest and biodiversity (including genetic, species and ecosystem diversity), control of pollution (including chemicals and waste) and of biological agents (including exotic species, biological control agents and GMOs). These benefits are situated at a regional level, but they contribute to the global welfare of the planet as well. In setting the standards, FSC took notice of the opinion of parties that are usually at risk of marginalization. Giving the social compartment equal power in the chamber structure, FSC empowers various stakeholders (indigenous people, forest workers, community- and small-scale forest users) with access, knowledge and voice. Between total banning (of logging and of activities such as subsistence harvesting and the use 57 of non-timber products) and overexploitation, FSC tries to find the middle path and reconcile man and nature. The beneficiaries of the FSC actions on the social plan are the workers (whose health, safety and well-being are cherished), the local communities and the indigenous people (through capacity building and acknowledgement of tenure and use rights) and the society in general (due to the economic development, to the mediation of possible conflicts and the investment for future generations). The economic benefits are a crucial target for this system that is in itself a market mechanism. They include differentiation in the marketplace, expected access to new markets, increased market share, enhanced profitability through the identification and elimination of wasteful practices. Some companies/ estates also see certification as a way of managing the risk of negative campaigns by environmental and social pressure groups (Nussbaum et al 2001). The individual objectives of certification are relatively easy to reach, but their simultaneous accomplishment is always problematic, sometimes due to their conflicting nature itself. The most acute conflicts are raised by costs: every additional requirement reflects itself in the costs, which in their turn reflect in issues of sustainability and equity. Difficult choices have to be made also when it comes to transparency (or safety from competitors vs. credibility). In a system as complicated as our planet, fixed indicators cannot be appropriate for all entities at all times. Where should the line between extremes be drawn? The following part of the project reflects this complexity and relativism and tries to balance the good with the bad in a reasonable way. The same rules and schemes applied in almost similar conditions can have different results. This is exemplified in what follows. 58 IV.5 Is (FSC) certification a new form of imperialism? About 2% of the world’s forests were certified in 2001, and many more millions of hectares are in the process of certification, although the subject is still debated in many countries. While producer countries and trade groups tend to consider it restrictive, consumer countries with strong environmental lobbies stress its potential benefits. More and more retail “do-it-yourself” chains and buyers’ groups in Europe and the United States have announced their support of certified wood products. About 92% of the world’s certified forests are located in Canada, Finland, Germany, Norway, Poland, Sweden and the United States (UNEP, 2002). Peter Feilberg, Forest Management Certification Co-ordinator for Smartwood/NEPCon in Denmark, declares that the FSC certifying rate is exploding, considering the number of certifications made by Smartwood/NEPCon this year (estimated 100) as compared to the 2001 number, when 12 certifications were carried out. But on analysing the certified forests, their majority is by far represented by state or industry-owned forests, mostly in countries that had already a market in the developed states that are now demanding certified wood. Presently, 96% of certified forests are accounted for by industrial or governmental forest owners. Only 34% of the total number of certificates, covering 3% of the total certified land area, are accounted for by communal groups and non-industrial users (Counsell, 1999). Could this be a sign that a new form of imperialism, market-based this time, is being born? For example, in Latvia interviews with the owners of the certified forests show that none of them depended on the income from the forest (FSC International). Romanian 59 companies that had a market in Western Europe became interested in certification when faced with a situation in which the buying companies have declared that they will turn to other Eastern European countries whose forests are FSC certified. In Russia certifications have been awarded to Pricebatch (Altai UK) Ltd, the main supplier of The Body Shop, and to the Arkhangelsk division of Holz-Dammers Moers Gmbh, the major supplier of Praktiker and OBI, the latter chain being itself a member of the FSC International. At the same time, Syktyvkar Forest Enterprise, the Komi “giant” in wood processing, declared to work towards FSC certification of its logging companies in Komi. In Hungary the process of certification began in 2000 with the award to a large state owned forest and the commitment of a major saw mill to FSC certification. ERDERT, a former state owned wood processing and trade company, was rewarded with an order worth nearly $ 1.5 million for finished timber from Scottish Woodlands Ltd. (one of the first largest UK company to achieve FSC certification), when beginning Chain of Custody certification in February 2000. The same Scottish company assists FSC certification on one state forest district in Slovakia (Rickwood, 2002). All these seem to be examples of two patterns developing in the forest and Chain of Custody certification respect: • The large scale, the industry- and state-owned forests have the majority in the number of awarded certifications • The certifications in developing countries are awarded to companies and forests that had a long established market in developed countries, and that are now responding to the demands/pressures/assistance of these buyers. The small forest owners in some developed countries seem to find themselves in the same difficulty as the developing countries who cannot afford to meet the 60 certification standards or to pay for the certification itself, and are thus indirectly more or less excluded from the market. Mr. Jimmi Enevoldsen, manager of the Frijsenborg Forest in Denmark, argues in the interview that the oversupply and the consumer’s power today make living from forestry a difficult task. It also appears that it is not easy to find buyers who are willing to pay more for certified wood in Denmark, possibly because they can buy it at lower prices from developing countries. Competition laws do not allow primary producers to communicate over the prices for their products, but the buyers are free to co-ordinate their buying prices. The situation becomes critical when large industrial companies have their own forests where they can create artificial low prices that make the market price lower as well, bringing the small forest owners to the point where they can not even cover their expenses. Further more, big industry and state forests can afford supporting the costs involved by certification, and thus have another advantage over the small forest owners. It has been estimated that becoming certified would imply an increase in costs by 2 - 10% because of limitations in the use of pesticides, fertilisers and the demands for an untouched forest area (Hatzfeldt et al, 2001, interview with Jimmi Enevoldsen, 2002, interview with Peter Fejlberg, 2002). In case that there is no secure market ahead, small landowners cannot risk such an increase in costs. In developing countries, forest owners who are left without a market are forced to start using the forest in other ways (like burning or transforming it into agricultural land). In cases in which this train of events happens, there appears a gap between the aims of FSC and the facts themselves. The effects of the severe storms in Europe in December 1999 confirm the disadvantage of primary producers on the market. The sharp reduction in prices in 61 industrial round wood was paralleled by relatively limited price changes in sawn wood, pulp and panel, but there were no changes in secondary processed wood products (furniture, cabinetry etc.). Thus, the risks and burdens are only on the primary producers (FAO, 2001). The interview with Mr. Jimmi Enevoldsen also highlights the fact that the inequity between industrial- and government-owned forests and the small forest owners or those in developing countries is also given by the management capacity. FSC requires minute documentation, paperwork that implies a lot of time, work and money (for hiring experts to asses the situation of the forest), none of which being easily obtained by the latter category. In the case of tropical forests, many people supported FSC in the hope that through valuing tropical timber, the forest itself would be preserved. But in some cases, the FSC requirements of reducing the volume of wood extracted /area collided with the companies’ needs for viable production quotas. This resulted in creating a new forest frontier, the access infrastructure opening up ever-remoter regions of tropical forests (Freris & Laschefski, 2001). The aim of empowering local people in small, community-based initiatives have sometimes proven difficult to reach as well. Periods of economic growth encourage people to migrate from villages to towns, to work in sawmills, but leaving their traditional way of using the forest in multiple ways and concentrating on the logging, they become exposed to market crashes. For example, Precious Woods Amazon, a company that was certified in 1997, has created 300 jobs in Itacoatiara when it arrived in 1997. But as the need for an area with a higher concentration of valuable tree species grew, the company is moving to the neighbouring state of Para, leaving the area in the same precarious condition as in the beginning. 62 The recently certified logging operation of Gethal in Brazil offers an example of how certified companies compete with lower impact local land use systems. The 1200 local people have no land rights and they are prohibited to practice their subsidence activities without Gethal’s permission. Unable to harvest the forest, they move to the towns, where they are likely to be unemployed and worsen the social problems (Freris & Laschefski, 2001). In the tropical regions the low-income people do not have the luxury of consumer choice offered by certification. Within Brazil, 85 % of timber from the Amazon is consumed in internal markets, so certified tropical timber sold to the elite of the first world has little influence on the global dynamics of the products. It could thus be argued that by buying FSC timber, consumers support the exploitation of raw material from a developing country by multinational companies. Marketing and market access issues seem to have more to do with the growing acceptance of certification than the environmental and social issues themselves. These opinions are counter-argumented by some forest owners that have already certified their properties – in Europe as well as in other parts of the world. In Germany and Switzerland group certifications were possible with costs varying between 0.2 to 1.3 Euro/ha/year (Hatzfeld et al, 2001). Even if the market for FSClabelled products is still not very large, some owners claim that they have experienced the advantage of selling more timber under better conditions than they would have done without certification. The relationship with the certifier is not in their opinion restrictive, but rather a kind of business consultation that is welcomed anyway, with or without certification (Hatzfeld et al, 2001). 63 As for the situation of forest certification in Eastern Europe, the process is developing with the support of the highly interested Western market. Netherlands supports Romania’s and Hungary’s efforts, Germany supports the certification process in Russia, while UK is interested in sustainable forest management in Latvia and Slovakia, and Sweden is supporting Poland’s processes by establishing a constant demand for their products. In Estonia, the first certified forest’s owner, Lambit Laks, declared that he covered the costs of certification within one year (Rickwood, 2002). In the same article Peter Feilberg, Baltic countries representative of SmartWood, considers this as an example of “integrating long-term economically profitable forestry without compromising ecological and social concerns.” Responding to the claims that certification discriminates between small-scale and large-scale forests in an interview to our group, he also declared that he assisted in three group certification processes where no financial help was needed for the small forest owners. The issue of small forest owners is under the focus of the FSC Secretariat, who is currently setting up a Technical Committee who will try to manage four issues: defining eligibility criteria; setting forest management standards and their interpretation guidelines for certification bodies; the Group Certification policy. The Technical Committee has the responsibility of balancing the needs of smaller forests, woodlots and forests managed on a very-low-intensity basis with the rigor of the FSC system. Their meeting took place in April 2002, and its results are expected to appear soon (FSC International- News & Notes, 2002). Some of the objections regarding the usefulness of the FSC certification system in the tropical regions are infirmed by examples in Bolivia, Brazil and Mexico. By mediating between logging companies and local people or indigenous communities, the certification schemes managed to integrate ethno-ecological local knowledge or 64 educational programmes as part of a network that uses certified wood on the spot, thus providing revenues and jobs in the area (FSC International, 2002). The FSC agenda also addresses improvements of the social aspects of the FSC policy through the formulation of a draft strategy document and through initiating comments and consultation processes on this document from April through June 2002. The final results will serve to the elaboration of the final version of the social policy for the 3rd General Assembly in November 2002 (FSC International- News & Notes, 2002). Turning our attention back to the tropical regions, a very different set of obstacles turns up. Here the land rights are often not well defined, concessions are given for shorter periods (3-10 years) and illegal logging is intensive. Attempts to solve these problems have been carried out for years, with remarkable little effect on the rate that the forest is being cut down (UNEP 2002, FAO 2001). It cannot be expected that the FSC solved this alone, especially not at the moment where most of the FSC certified forest is concentrated on the northern hemisphere. Several tropical countries, however, have certified a substantial amount of forest. The forest problems are only a part of the problems in the less developed world. Brundtland, Rio de Janeiro and the coming Johannesburg conference are all attempts to push the global society in another direction. The 2002 UNEP report conclusions are that the wealthiest part of the world is progressing quite a lot and is getting many threats under control, while the gap between North and South is becoming even greater (UNEP, 2002). This is a clear indication of the problems about the promises that were made in Rio in 1992, but have to a large extend not been met, showing a lot of good intention but also a failure to carry it into practice. 65 The following is an attempt to fit FSC into these perspectives and to point out where and how FSC could be an increasingly important player in this mosaic. Even before reaching a point where certification can be discussed, the first problem has to be solved: Land rights. The tenure and right to use the forest is implemented in FSC principle No. 2. The extent of this problem is huge and the consequences devastating. Sustainable forest management is not confined to shorter periods. No feeling of responsibility can be expected if the concession for logging is lasting only 5-10 years, and even for longer periods. This goes for keeping any kind of values in the forest – economical as well as biological or social. As defined in the introducing chapter on economics, sustainability tries to keep the values (at least) at the same level as previously over time (permanently). But with immense problems at hand, governments are often looking for a fast income, and sale of high quality wood is one of the means used to raise foreign currency. Here lies one of the major tasks that can probably be solved by international agreements only by securing the countries that own the valuable resources with incentives for them not to overexploit. This can only be done by creating economic safety, either by implementing a system of guaranties or by developing a beneficial market for the products taken out of the forest. As mentioned in the economical introduction (chapter III), only some 6 percent of the non-coniferous tropical round wood for industrial purpose is exported. This could lead one to the conclusion that trade has a rather insignificant role as a tool to promote FSC or sustainable management in general. It is important to notice, though, that these 6 percent is the most valuable part of the forest production, and is therefore of quite some importance. The demand for FSC products is much more pronounced in the western world, since this is where the economic surplus is i.e. where the consumers are rich enough to pay 66 the price of sustainability. Therefore trade with tropical timber products should rather be promoted, rather than forbidden, but with demands for sustainable management. It cannot be expected that a national or local pressure for sustainable production will erect, since problems of more severe character are almost always at hand. The round wood production is (together with mining and oil industry) a key-factor in opening up the forest for other destructive uses. By securing the forest under the FSC principles and criteria’s degradation would be stopped, but not the use of forest for multiple purposes. Instability is rather often quite a problem in less developed countries, and this goes for both the political and economical situation (very often, economical instability creates political instability, and vice versa; thus political and economical disruption often go hand in hand). The economy is often depending on just a few primary products such as bananas, coffee, oil or tourism products. Their actual value is very susceptible to the market price, which has severe consequences when prices go down. Countries being economically based on only a few primary products would be expected to have a strong motivation for emphasising the use of the vast array of nontimber products. This could to some extent diversify the sources of income, and as a consequence make the national economy less vulnerable to fluctuations of a single resource. A potential problem pointed out by critics is that small tropical forest owners cannot be certified, it being too complicated because of lack of management capacity, education and organisations. Thereby only the biggest and richest holders will be able to obtain certification with FSC, creating market advances and eventually an even bigger social gap. The observation is fairly good, but some more consideration might change the conclusions quite a bit. 67 The amount of wood entering the export market originating from small forest owners is very small. Most of the forest products from these areas only enter the local market, a market that will not be demanding FSC in any near future, since other concerns are more stringent. However, work is being done to promote group certification also in the tropics and also to simplify the process of certification (FSC Bolivia, 2002). This being done actually creates a possibility to open the market for the small forest owners, since they get to produce certified wood attractive for the export market. Further on, group certification can possibly promote and strengthen local communities, giving them a source of income and a better organisational level. This leaves them stronger and in a better position to fight illegal logging. The tragedy of the commons described earlier, will be less pronounced, and a strong motivation to keep out unwanted logging in their area will develop and make people act more responsibly. V. OTHER CERTIFICATION SYSTEMS V.1 The Pan-European Forest Conservation (PEFC) The main alternative for the FSC -certification system in Europe is the PEFC (Pan European Forest Certification). It was officially launched in Paris in 1999, but its criteria are defined by the resolutions of the Helsinki and Lisbon Ministerial conferences in 1993 and 1998. The PEFC initiative was started by Finnish, German, French, Norwegian, Austrian and Swedish forest owners, but participants from Belgium, Canada, Czech Republic, Denmark, Great Britain, Hungary, Ireland, Latvia, Luxembourg, Portugal, Slovenia, Spain and Switzerland also become involved in the 68 development work. PEFC is a European certification system, but there are members with observer status from for example United States, Australia and Canada (PEFC). PEFC is mainly funded by its membership fees and the EU (Sprang, 2001). Like FSC, it provides performance standards and relies on third party certification. However, PEFC is not an accreditation body itself, but it leaves the accreditation procedure to National Accreditation Services that use national schemes as a starting point to the assessment. Its argument is based on ISO Guidelines in particular ISO Guide 61 “General requirements for Assessment of Certification/Registration Bodies”, which states that accreditation bodies “shall not offer or provide, directly or indirectly, services to design, implement or maintain a certification scheme” (PEFC, 2002). In practise the national schemes work quite much like the national schemes of FSC. A national scheme is created by a forum, in which all interested parties are allowed to participate. This scheme is assessed by the PEFC Council, and if it is considered to follow the elements of sustainable forest management (SFM) set by the PEFC council, it can be approved to be a part of the PEFC system and a logo and claims can be used on forest products (PEFC, 2002). For example in Finland, the majority of the forests has been certified according to a certification system called FFSC, Finnish Forest Certification System, which is a national application of the PEFC system and has been accepted as a part of it. The approach in the development of the FFCS has been to harmonise it with both international forest certification systems (PEFC and FSC) and the ISO and EMAS systems (FFCS, 2002). 69 According to for example the FFCS, this system is compatible with the principles of FSC, and in the beginning it was supported by most of the environmental NGO's that also participated in the preparation of the standard proposal (FFCS, 2002). However, considering that this system does not promote sustainability in an efficient way, most of them have now withdrawn from it and started supporting FSC. V.2 Sustainable Forestry Initiative (SFI) The Sustainable Forestry Initiative was launched in 1994 by the American Forest & Paper Association (AF&PA) and its focus is to improve the forestry practises of the U.S. forest products and to promote sustainable forestry among private and other landowners in the United States. It is still predominantly an U.S. oriented program. The SFI program receives about 82% of its funds from AF&PA members (Meridian Institute, 2001). A Sustainable Forestry Board (SFB) comprised of fifteen persons defines standards, accreditation and certification processes. Nine of the seats are occupied by nonindustry representatives and the remaining six seats are designated by AF&PA. Also the Executive Director is on contract to AF&PA. Landowners and outside stakeholders can participate in the development of standards, but the modification of standards is decided by the SFB. The structure of SFI is different from the FSC one. It includes 5 principles, 11 objectives including performance measures and indicators for verification. Thus, there is little room for interpretation of the SFI standards by the auditor (for example the certification company). 70 The certification of SFI is a first-party certification, i.e. self-verification in the form of an annual report to AF&PA. Second- and third party verifications by customer are optional. However, it is required for all AF&PA members and licensees who desire to use the newest version of the SFI program logo or use the SFI on-product label when it is authorised by the SFB or AF&PA. The SFI can be considered to promote economical and to some extent also ecological sustainability, because issues like sustained yield, clear-cutting, management planning, education, water quality and biodiversity are included. However, it pays little attention to social viewpoints like indigenous peoples, forest workers and locality. Also rules concerning GMOs, pesticides and plantations are very loose. These areas are considered to be covered by the U.S. legislation. However, SFI was constituted primarily as an economical association, so its declared purposes do not include as a major issue the certification processes. V.3 ISO 14001 The International Organisation for Standardisation (ISO) was established in 1947, originally focusing on technical standards for products. Recently it has also moved to production processes. ISO 14001 is a special approach to environmental management, and it is applicable to all economic sectors (ISO, 2002). The main difference to FSC and PEFC certification systems is that the ISO does not specify forest management performance standards, but emphasises management system standards by offering a framework for the certification of environmental 71 management systems (EMSs). Thus, the EMS is certified, rather than the forest (FCAG). Neither does it permit a label to be used on products (ISO, 2002). ISO is developed by commercial and governmental bodies, but it is a nongovernmental organisation. A breech in this system, however, is that out of its 120 members, about 90 are full members and the rest (often from poorer or smaller countries) have fewer rights. One member is accepted from each country, and the members can work as national accreditation bodies although ISO itself is not an accreditation body. The need for new standards can be proposed by a member, a working group may be set up to negotiate the standard and 75% of the voting members must agree to it before it can be established (ISO, 2002). Because ISO neither specifies levels for performance, nor provides specific accreditation for forestry, it is insufficient to be used as such in forest certification. Other problems of ISO 14001 are that it does not consider the cultural and social conditions, and participation of environmental and social NGO’s, developing countries and indigenous peoples’ organisations is limited. Neither does it take into account the Chain of Custody. However, it provides general principles and guidelines that can be applied when creating systems that assess performance levels. Its guidelines are highly appreciated and applied in the development of both PEFC and FSC (Sprang, 2001) and SFI (Meridian Institute, 2001). V.4 Eco Management and Audit Scheme (EMAS) EMAS (Eco Management and Audit Scheme) is the EU's system for environmental management and environmental auditing. EMAS is coupled to the international 72 environmental standard ISO 14001 in that companies can use this standard when building up their EMAS-system (EMAS, 2002). An environmental management system of EMAS/ISO 14 001 type regulates the conditions for environmental work. The system lacks absolute demand levels (except that the laws must be observed), and it does not engage in product labelling. Like ISO 14001, EMAS is not a sufficient certification system itself, but can be used as a guideline when developing specific performance levels for certification. V.5 FSC vs. other certifications The FSC, PEFC and SFI all provide performance standards, and can therefore be directly applied in forest certification. The FSC is the only worldwide certification program and only one logo is used. This may decrease confusion among consumers, but on the other hand, it is difficult to set standards covering all ecologically and culturally different forest areas. For this reason the principles have to be quite generic, and specific performance levels are set by the national working groups. Also PEFC relies on national initiatives that have to be endorsed by the PEFC-Council. The SFI gives principles and objectives that include very specific measures and indicators for verification, and leave little room for the verification by the auditor (Meridian Institute, 2001). Obedience to the standards is controlled very strictly in the FSC. A field assessment has to be made before granting a certification, and it also takes place after five years. In addition, monitoring visits are conducted on at least yearly basis (Sprang, 2001). The PEFC does not require field assessment even if spot checks can be made 73 (Sprang, 2001) and the verification of the certification may take place many years after the certification. This can be based only on the reports provided by the applicant (WWF, 2002). The SFI requires only a first-party verification in the form of an annual report to the AF&PA (Meridian Institute, 2001). Accreditation seems to cause difficulties to PEFC as well as to FSC. The WWF criticises PEFC for lack of reliable accreditation mechanisms, because although the PEFC scheme requires a specific accreditation for certifications carried out under their system, specific accreditation procedures have not been finalised yet. Instead, the system relies on generic accreditation based on ISO guides, which, according to WWF does not fulfil the specific needs for forest certification (WWF, 2002). Specific standards, accreditation procedures and strict supervision guarantee high reliability, but also increase the costs. This might hinder the certification in developing countries, where it is needed the most. However, group certification may, as it has been shown, decrease the costs because monitoring costs are divided between many forest owners. PEFC also supports group certification, but it has still been criticised for favouring large producers because an individual forest owner cannot become a member. In addition, the voting power at the European level depends on the amount of timber produced nationally (WWF, 2002). The WWF accuses the PEFC for misleading claims. For example, a claim “Promoting sustainable forest management” can be used together with the PEFC logo even if only 70% of the products come from certified forests (WWF, 2002, PEFC, 2002). The FSC-logo can only be used for 100%-certified products. This requires very careful chain of custody –verification, which again increases the costs. 74 Perhaps the most significant differences between the FSC and other certification are the range of issues considered in the principles and the participation of different stakeholders. According to a WWF's report, equal participation of interest groups and balanced decision-making, as internationally agreed in Agenda 21 and in regulation of ISO is not implemented in the PEFC (WWF, 2002). Non-governmental organisations may only become extraordinary members without voting rights of the PEFC. The principles of the PEFC and SFI promote mostly economical and to some extent also ecological sustainability, but both pay little attention to social values. The ecological standards are also much stricter in the FSC than in the PEFC and SFI, which rely quite much on the national legislation. The chairman of the Finnish Fund for Nature, Heikki Simola, stated that "The demands of the PEFC system are so loose, that all Finnish forests can be certified by it. As there are over 700 forest species under a threat of becoming extinct because of the forestry, it is clear that environmental organisations cannot support this kind of certification" (Finnish Fund for Nature, 2002). VI. CONCLUSIONS As the world’s wood consumption continues to increase due to increased necessities, human kind finds itself faced with the problem of finding the resources to cover its needs. After considering the forests as inexhaustible, self-regenerating resources for a long time, people started realizing that they will either need more forested areas (which are not available), either try to use the existing ones in a wise way. 75 The role of the forests in the global and regional ecosystems becomes more and more obvious as more studies are conducted in different science fields. More important yet is the tendency of the scientific endeavors towards interdisciplinarity nowadays. Ethics, Anthropology, Ecology, Geography, Political Science, Law, Economics, Medicine, Statistics, Planning join their efforts to understand the environmental, social and economic phenomena connected with forests and to find viable solutions to old or new problems. Where citizen conscience dictated that responsibilities regarding “common goods” do not belong only to governments, society started taking steps in the direction of creating new structures to support sustainable development. This materialized in a number of conventions, treaties and voluntary agreements that started acting as “soft law” and in some cases have been imposed as legally-binding rules afterwards. Further more, civil society initiatives constituted themselves in bodies that use market instruments to regulate forest-related processes. Thus, the Command and Control, top-bottom approach started being completed by bottom-top actions. Environmental and social NGO-s, forest owners, industrial companies etc. decided to do what was in their power to find the way to sustainable development. This led to the appearance of certification bodies and processes – first at the national and regional level, and starting with FSC, at the international level. Our project focused on the FSC system of certification, trying to find the answer to the question of whether it is a reliable system that contributes to sustainable development or not. Another concern was about the appropriateness of FSC’s being recommended in the future. 76 During the study we realized that while everybody agrees that the idea of certification is noble, objecting voices are being heard regarding the way of actually putting it into practice. The problems related to FSC certification touch a number of subjects: • The conditions in different regions of the globe vary a lot and there are doubts that an international system can comprise this complexity and offer valid specific solutions; • The market for certified products is still too small for forest owners to afford to take the risk of investing their money in certification; • The consumers in developing countries do not have the luxury of choice when it comes to buying certified/non-certified forest products; • Trade barriers might be created when consumer countries decide to buy only certified products, thus leaving small or poor forest owners without a market. This can make the problems even worse, as these owners could decide to transform their area into more profitable farms and plantations; • The certified area in the tropical areas is still very small, where it is most needed; • The FSC functions as an international accreditation body as well, which leads to accusations regarding their lack of credibility and transparency; • There have been reported cases of illegal logging and local people’s discrimination in FSC certified forests as well. On the other side, FSC’s presence made possible a series of environmental, social and economical phenomena that indicate significant progress towards sustainable forest management: The FSC structure is the only one that gives an equal amount of power to different interest groups and to developed and developing countries as well. 77 The transparency and credibility issues are self-demanding, since the process of certification depends on public opinion and trust. While prescribing obedience to the national laws, the system functions as a completion to these laws. Further more, in cases where the legislative or executive system is not efficient, the fact that certification implies a voluntary agreement acts as soft law, using market mechanisms to reward/punish the forest owners/users. In most of the cases, the FSC principles implementation created equilibrium between socially and economically interested parties. From an environmental point of view, the benefits of FSC certification are hardly debatable. The issue of plantations is dealt with by the permission to certify such forests that are in the process of changing this situation. FSC has developed strategies to help small forest owners through group certification. The results are already successful, and the process is still in progress. Even if higher prices cannot be obtained, certified forest owners have experienced the opportunity to sell more wood than before, just because it was certified. The small forest owners in the tropical areas are not yet addressing the external market, so the claim that they are excluded is not valid. However, if they enter group certification, it would be possible for them to access to new markets abroad. The FSC system supports the development and use of forest products other than timber, thus making the forest less susceptible to natural or economical disasters. While trying to be as accessible as possible, the FSC certification system has to respect the rigorous level of standards in order to maintain credibility and efficiency. FSC cannot be expected to solve all the problems related to forests. But as long as it is aware that it does have shortcomings and it works on correcting them (and it did take notice of the criticism and it initiated bodies to respond to all the problem areas – especially the social issues and the small-scale forest owners needs), it is one of the 78 most efficient non- governmental instruments that we have at hand. The best news of the future would be the news that initiatives like FSC are no longer needed, but since that is not likely to happen very soon, the presence of any positive action in this direction is welcomed. We estimate that the rate of certified forests will increase and that this will lead to a more sustainable way of managing the forests. Provided that the group certification policy is implemented in the right way and the organization continues to pay attention to the needs of the members, of the market and of the global ecosystem, while at the same time promoting their actions worldwide, we believe that the FSC certification system is and will be a reliable tool for sustainable development. 79 REFERENCE LIST Barbier, Edward E., Burgess, Joanne C., Bishop, Joshua & Aylward, Bruce: Tropical Timber Trade, 1994 Begon, Harper & Townsend: Ecology-a Study of Interrelationships, 1996 Bugge, H.C.: General Principles of International Law and Environmental Protection – an overview, in Environmental Law - From International to National Law, edited by E.M. 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