Asia Pulp & Paper and sustainability: When do you reward a company for reforming?

Entrance to natural forest reserve in Bukit Batu, Riau, Indonesia.
The forest is surrounded by buffer zones, but threatened daily
by incursions for timber and palm oil development
Asia Pulp & Paper’s recent shift from environmental villain to natural forest protector has been well documented. 

For ten years the company was at the sharp end of one of the longest and most bitterly fought campaigns by conservation NGOs. Primary among these was Greenpeace, with Rainforest Action Network and WWF also very active.

This campaign resulted in the company losing an unknown amount of business. Some say billions, others less. 

All major brands associated with sourcing from them eventually made sure their supply chains were APP-free. Finally the pressure told and the company relented. Critics say this was only when the company became self sufficient in plantation fibre in Indonesia.

Beginning January 31 2013, APP put in a place a moratorium on natural forest clearance across their 38 owned and independent suppliers’ concessions in Indonesia. APP are working with the Forest Trust, an NGO, which has helped develop APP's forest conservation policy and is assisting with its implementation.

Pristine natural forest in Bukit Batu
Several breaches of the moratorium have been alleged since the 2013 moratorium announcement. These have been investigated by the Forest Trust and APP. Two were confirmed and reported on publicly. APP self-disclosed the third. In total these breaches have led to around 140 hectares of natural forestbeing destroyed. This is out of 2.6 million hectares of APP concession area. 

So it’s fair to say that the company has clearly stopped cutting natural forest. A little has been cut by accident by suppliers, and, in one of the breaches, forest was cleared as a result of a community livelihood agreement.  

The Forest Trust is now undertaking high carbon stock assessments of APP’s concession areas across Indonesia, and what’s called high conservation value assessments are also underway. The plan being to understand which bits of remaining natural forest are the most rich in both carbon and biodiversity by July 2014.

The results and recommendations of this assessment work will be used to create integrated sustainable forest management plans. These will govern how APP manages its concessions and influence land use around these in future. A Forest Conservation Monitoring Dashboard, run by the Forest Trust, allows anyone to monitor implementation of APP’s progress on a real time basis.

Community boat builders, also keen on
cutting forest for palm oil and rubber
So far so good. But will APP’s progress be rewarded by the market?  

Rainforest Action Network believe it is too early for customers to return. They say the company has not yet demonstrated enough progress, particularly given past collapsed NGO deals. WWF, meanwhile, wants to see APP address its legacy of forest destruction and set out plans for restoration before customers return.
Greenpeace has taken a more nuanced position, suggesting that customers wishing to resume trade with APP must link contracts and procurement to continued delivery of the forest conservation policy.

Fish Eagle, Bukit Batu
The RAN and WWF position is wrong-headed. Companies who take embedded leadership positions, as APP now has, must be rewarded as soon as big companies buying from them can credibly do so.

Having spent a week with the in the midst of one of their concessions recently (and by no means a Potemkin one), I agree with Greenpeace.

On my trip*, documented on this blog, I saw with GPS tracker, camera and maps in hand, from a helicopter, by boat and on foot, how the company is the only actor in parts of Sumatra that is trying to protect what is left of the natural forest. The Indonesian government’s wildlife park, bordering on APP’s Bukit Batu concession, was on fire, as ‘locals’ (hard to say who is and who isn’t local) cleared swathes of it, illegally, for oil palm plantations.

Natural forest in APP concession
The brutal reality of Indonesian deforestation is utterly shocking when you see it for yourself. 

Rhett Butler at estimates that overall, "Since 1990, the island's (Sumatra) primary forests shrank by 40 percent while its overall forest cover declined by 36 percent, mostly the result of logging, agricultural expansion, and conversion for oil palm and timber plantations."

APP has been responsible for much of it. But the company is the best chance Indonesia has of saving what is left. Assisted by the Forest Trust and monitored by Greenpeace, APP really does appear very serious about sustainability. This is a company, which now cannot go back on its promises. Palm oil trader Wilmar has also recently made highly significant no-illegal deforestation commitments. The tide is turning against deforestation by large companies.

As a result large companies sourcing pulp and paper should reward APP with procurement contracts, which are linked to the implementation of the Forest Conservation Policy.

National park on fire for illegal
oil palm clearance, likely by migrants 
Staples have done this already. After a five year sourcing gap and a site inspection, the company has taken a bold leap of beginning to buy again from APP on the basis of further close inspections and Rainforest Alliance’s evaluations. 

Sustainability leadership often means taking leaps of faith based on both evidence and trends. APP’s commitments offer an opportunity for buyers to both reward systemic progress and show other companies that making serious progress will be rewarded by the market.

(Here's an earlier post on my recent visit with videos and a slideshow of images with explanations)

*In the interests of disclosure, I should note that APP paid for my recent trip to Indonesia.

(Some additional coverage on the issues with Indonesian forest protection can be found on the excellent site. Take a look here, and then again here with regard to community deforestation issues)
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