Timber Trade Federation
Growing the Use of Wood

Responsible Sourcing of Timber
UK Industry Experience tackling
illegal logging
Andy Roby
Head of Environment and CSRPresentation
1. Good wood and bad wood
2. Managing risk as a trader
3. UK Market for Certified
Timber
4. Illegal Logging
5. Responsible Timber
Purchasing2

Who am I?
• Andy Roby
– Tropical forester (Bangor,Oxford), Henley MBA, 22years working ininternational development(Africa, Latin America,Asia)– 5 years in the timber trade:
Corporate Social
Responsibility (CSR),
illegal logging andstakeholder relations.

310 year old Framire
Plantation, Mbalmayo,Cameroon

41. Wood is “Good”• Forests cover 1/3rd of the land surface• Forests perform many useful environmental
functions:– Carbon sequestration• 1m3 of timber stores 0.9 tonnes of CO2,• Substituting timber for concrete saves 1.1 tonnes of CO2.
• Reduce your carbon footprint– Clean Water• Forests reduce soil erosion and water run off• NY City paid $1.4 billion for watershed services– Biodiversity – e.g. new medicine, compounds, genes,– Food, oils, condiments, textiles, medicine– Recreation and aesthetics
5What is Good Wood?
• Definitions of Good:Fit for purpose; technical qualities, aesthetics, price
Sustainable = renewable
Social benefit
Economic benefit
Environmental benefit

But sustainable can also mean recyclable, thermal efficiency(timber is 15x better than concrete, 400x steel, 1770
aluminium), low embodied energy, low pollution, …..
Legal
Climate change –trees absorb 25% of global CO2 from fossil fuels
Europe’s forests = 20 billion tonnes of fixed carbon• “Use it or lose it”
6Badly Logged Forest7

Well managed logging (reducedimpact)

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… but some wood is bad• Illegal logging• Deforestation in Indonesia, Brazil,Philippines, Africa• Conflict Timber– Liberia– Congo-Kinshasa– Cambodia– Burma• Collapse of society…….
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Sumatra’s lowland forests below 500m
are almost gone !

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sr
ett
am
noit
atupe
R
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Greenpeace International Press
Release“London, International — A
criminal trail of illegally logged
timber from the world's last
rainforests, which is 'laundered'in China before arriving inEurope, the USA and otherconsumer countries, has been
uncovered by a major
Greenpeace investigation.

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Admiralty Arch, Nelson’s Column, Houseof Commons….

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2. Managing Risk as a Trader

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Where is the risk greatest?

Where the forest is going fastest!
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UK Consumption by Volume of Imported
Tropical/Non-Tropical Timber & Panels 2003
9,000

7,000

Total 2003

6,000

Tropical

5,000

Non-Tropical

4,000
3,000
2,000
1,000

dsFi
breb
oar

SBOPl
yw
oodParticlebo
ardH

ardw

oodood-Softw000s cbm8,00020

What can traders do about risk?
Ask for:sustainable timber with chain of custody

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The main ones

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What can traders do about risk?
Ask for:sustainable (certified) timber with chain of custodylegal timber
suppliers to be members of a scheme progressing
towards verified legal and sustainable timber, e.g.
Timber Trade Action Plan, Tropical Forest Trust,
Smartwood, Tropical Forest Foundation, WWF GFTN
– Need to know where the wood came from– Provide a framework for continuous improvement leading tolegal or sustainable timber– Get hold of objective evidence about the timber23

3. UK Market for Certified Timber

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Chart 1: Change in ce rtified fores t area Decem ber 1996-2005(m illion hectares )

300
250
200
150
100
500
1996

1997

1998
FSC

1999
SFI/PEFC

2000

2001

OTHER PEFC

2002
CSA/PEFC

2003

2004

2005

MTCC

RupertRupert Oliver,
Oliver, 2005
2005

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• Certified supply isincreasing• UK imports;– 60% certified– rising by 5% p.a.
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Supply and Demand27

Is certified timber available in all
product categories?
• Plenty of certified softwood in PEFC and FSC,
but some structural timber is only available inPEFC• Temperate Hardwood – more limited PEFC,CSA, SFI and FSC• Tropical Hardwood – growing quantities of FSC(Bolivia, Brazil, Cameroon, Congo Brazzaville,Indonesia, Malaysia…) and MTCC from
Peninsular Malaysia
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UK Market Demand• New reports by Rupert Oliver and Nick Moore• Overall demand for certified timber = 10%• Oversupply of certified timber• Key segments have a small (2-7%) premium:– Hardwood plywood– Hardwood sawntimber• Steady but low demand for verified legal timber• It should be rising!
• Suppliers are responding31

4. Illegal Logging

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Where is Illegal Logging Greatest?

Where the forest is going fastest!
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What is the trade doing aboutit?

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TTF ACTION
A. Code of Conduct

35

Greenpeace International Press
Release“London, International — A
criminal trail of illegally logged
timber from the world's last
rainforests, which is 'laundered'in China before arriving inEurope, the USA and otherconsumer countries, has been
uncovered by a major
Greenpeace investigation.

36

TTF Code of Conduct
New: TTF will issue
specificguidance onbuying
complying withthe Code ofConduct forpurchases fromhigh riskcountries
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TTF Country Guidance• Brazil, Ghana Guyana, Indonesia Malaysia,Russia• Documentary evidence of legality• Overall reliability of documentary evidence
depends on Corruption Perception Index ratingfrom Transparency International• Lower rating means independent verificationby 3rd party auditors is recommended.

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Example Country
DOCUMENT & DESCRIPTION

Userights‘SFP’ - State Forest Permission (harvesting license <8,094 ha / 2 years)‘WCL’ - Wood Cutting Lease (harvesting license -8,094-24,281 ha / 3-10years)‘TSA’ - Timber Sales Agreement (harvesting license >24,281 ha / 15-25years)

Forestmanagement

Annual Plan of Operations

Fees &Taxes‘Removal Permit’ - GFC Permit to Remove Forest Products

Transport &CoC‘Removal Permit’ - GFC Permit to Remove Forest Products

Forest Management PlanCustoms Declaration form
‘Transhipment Permit’ - GFC Transhipment Permit to Remove ForestProducts
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GFC Declaration of Forest Products Removed from Private Property

TTF ACTION
A. Code of Conduct
B. €7m EU Timber Trade Action Plan –verified legal timber from 150 mills andforests in Indonesia, Malaysia, Gabon,Congo-Brazzaville, Cameroon, China,Brazil, Guyana, Bolivia

40TTAP – Supply Chain Management

Long andcomplex

To hereA verifiedlegal supplychain
From here
Source: Scott Poynton, TFT

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TTF ACTION
A. Code of Conduct
B. €7m EU Timber Trade Action Plan –verified legal timber from 150 mills andforests in Indonesia, Malaysia, Gabon,
Congo-Brazzaville, Cameroon, China,Brazil, Guyana, Bolivia
C. Responsible Purchasing Policy42

If a trader can’t get certified timber withChain of Custody?
• Use the Responsible Purchasing Policy toassess your supplier• Ask for legal timber• Look for suppliers partnered up with credibleorganisations such as: Tropical Forest Trust,
Tropical Forest Foundation, Smartwood, WWF’s
Global Forest Trade Network, etc.
• Follow the Code of Conduct guidance on buying
legal timber
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5. Responsible Timber Purchasing

44Responsible purchasing by a timber tradermeans:• You know where
your timber camefrom• You are managing
your risk of using
illegal orunsustainable timber• You are managing
your customer’s risk
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The TTF Responsible Purchasing
Policy (RPP)• A business tool to help you manage your timberstocks:– Gathering and reporting objective evidence oflegality/sustainability– Monitoring continuous progress towards 100%sustainability– Identifying and eliminating high risk potentially
suppliers– Advice and support to suppliers• Independently audited for credibilty
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RPP in a Nutshell
1. Sign up
2. List suppliers by country and volume
3. Ignore certified suppliers
4. Take top 50% of high risk countries
5. Ask suppliers some questions
6. Give product and supplier a risk rating
7. Decide how to lower the risk rating
8. Submit Annual Management Report for audit
In Year 2, repeat with remaining 50% of suppliers
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It’s got a lot easier!

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Continuous Improvement

tsumecn aram yer
fo eryre v
pe
yn ve
aopr
m mpoiC% contracts
Sustainable% contracts
Legal &towards
Sustainable%contracts
Legal(verified)timber

50% contracts
risk assessed
Implement
contract risk
assessment
system
TTF Code ofConduct49

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36 successful in 2007••••••••••••••••••AW Champion Ltd,Arnold Laver & Co Ltd,Brooks Brothers
BSW Timber plc
Caledonian Plywood
Capricorn Timber
Channel Woodcraft Ltd
Crown TimberDanzer
DLHFinnforest UK Ltd
Finnish Fibreboard
Flatau Dick (UK) Ltd
Frank Gresham
Gill & Robinson LtdHanson Plywood
Hollanden Timber Ltd
Hoppings Softwood Products•Howarth Timber•International Plywood•James Donaldson•James Latham plc•John Boddy•John Robertson•John Wright•Howie•Medite (Coillte)•Morgan & Co
•Premier Forest Products•PT Agencies Ltd•SCA Timber Supply Ltd•Snows Timber•T Brewer & Co Ltd•Timber Connection Ltd•Wolseley UK•Wood International (Far East)
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What RPP companies will begetting for their trouble• Listing on TTF and other websites• Publicity in trade journals• Easier access to public contracts• Recognition in pre-screening to supply
construction companies• Certificate and logo
• International recognition• Easier compliance with the Code of Conduct• Access for their suppliers to a 72% subsidy for
Chain of Custody work under the Timber Trade
Action Plan with the Tropical Forest Trust
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What next for the RPP?
• Presentations and training for construction
companies and the Major Contractors Group• Promotion of RPP companies to othercustomers, banks, investors, government,NGO’s.
• More members – target is 80 by 2008, currently
there are 42• Get the TTF and WWF schemes to converge
more• International recognition – EU, Japan, China,North America
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The RPP still helps meetgovernment (CPET) requirements• Objective evidence of the legality andsustainability of their timber• The RPP timber trader can provide theevidence quickly and easily• Because the RPP is audited the govt
buyer can be confident the evidence iscredible57

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Responsible Purchasing
saves forests

Thank You
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