The world’s forests are under threat. This places the entire planet at risk as they work as the globe’s lungs.
Developed nations in the North have been effective at restoring forests, but much of this destruction continues throughout developing countries in tropical regions. While small landholders clear their fair share of forests, many companies producing some of the world’s most coveted raw materials — including pulp, palm oil and rubber — also contribute to this problem. Hence business-friendly publications such as The Economist have called on the private sector to find solutions for this ongoing challenge.
And while the evidence suggests that more governments across the world have their heads wrapped around this problem, more needs to be done. The Bonn Challenge, which aims to restore and conserve 150 million hectares of forests by the end of this decade, is a step in the right direction. But environmental groups such as Greenpeace have described the threat to forests as a crisis and called for companies to take aggressive actions to stop the destruction of forests and other ecosystems, including peatlands.
One company that says it is rising to this challenge is Asia Pulp and Paper (APP). Long the target of environmental groups, in recent years the company has earned at a minimum begrudging respect from the likes of Greenpeace for its zero-deforestation efforts and landscape-restoration work in its home base of Indonesia. Last December at the COP21 talks in Paris, the company committed to finance the restoration and protection of one million hectares of Indonesian forests. The company says that it is the first and only private-sector company to have such a pledge accepted by the Bonn Challenge so far. That move is another step in APP’s forest conservation policy, which the company launched in 2013 as part of its plan to stamp out all forest clearance across its entire supply chain.
To learn more about the company’s work on landscape restoration and why the company is making these investments, TriplePundit spoke with Aida Greenbury, APP’s managing director of sustainability, during the IUCN Congress last week in Honolulu.
Greenbury framed APP’s shifting policy as a business imperative. “We had to move to a new business model,” she said, “and it had to be implemented down to the supply chain level.”
As part of what APP says is its work to transform its supply chain, the company claims it has invested over $200 million in such efforts since it changed its sourcing policies in 2013. These funds paid for a bevy of programs. One of them ensures that locals living in and around APP’s land concessions have due process under the principles of free, prior and informed consent (FPIC). Other initiatives concentrate on stopping the fires that have shattered the reputations of companies within the pulp, palm oil and rubber industries. In addition, APP will spend another $50 million on what it describes as “de-risking” its forest investments and $10 million on the 1 million-hectare forest preservation commitment.
From APP’s perspective, these promises will not work if the company cannot back them up with sound programs. So included in these de-risking investments are programs that work with local governments to ensure FPIC principles are followed. The company is also consulting with a wide range of scientists, including agronomists, to ensure projects such as those focused on agroforestry can succeed.
Agroforestry is one tactic APP is counting on in order to see its forest preservation policies succeed. The idea is that locals who live within APP’s land concessions will grow profitable crops on dedicated land so that they are not tempted to clear cut forests in their quest to find economic security. But this is more than providing families tree seedlings and the sharing of best practices in farming. A community that finds success in growing crops such as mangoes or coffee will not be satisfied long if they cannot find markets for their products.
To that end, APP says it is working with a coffee customer in Europe to find ways to purchase and brand coffee grown on some its land concessions; the same is being done with a Japanese company interested in purchasing fruit grown on other lands. Agroforestry, like conventional agriculture, is not an exact science: successes in Brazil may not work in Indonesia, and ideas that can take root in Sumatra may flounder in Kalimantan.
“At the end of the day, I have to explain what these millions of dollars in investments mean to our company’s shareholders,” Greenbury told us. “I have to make the business case for landscape restoration, so it has to work.”
There are many pieces to this puzzle: The company needs a secure amount of pulp to keep its operations running smoothly, local communities need to be incentivized so they don’t cut down trees, and forests need to expand so the company can keep the trust of its stakeholders. If APP can succeed on these efforts and score buy-in from environmental groups, this company could become a leading case study of how economic growth can align with sustainable development.