I recently worked with a couple of national retailers that sell products made from, or containing, wood or paper.  Both companies had determined that the risks to their businesses if they sold timber/paper products sourced

Selling timber products sourced from illegally logged forests can be a risk to business

from sensitive forests were unacceptable.

Why should we care about forests?

Forests are important to us locally and globally for a number of reasons, including:

• Providing clean air;
• Providing clean water;
• Providing natural resources;
• Providing  habitats for all kinds of species, including many that are endangered or critical;
• Mitigating  climate change;
• Providing income and livelihood to communities; or
• Just for their own beauty and wonder.

However, the threat to our forests, and the people and industries that rely on them, is increasing with our growing demand for timber and wood products, paper and paper products, food, palm oil, rubber production, agriculture and urbanisation or forest fringes and forests.

Harvesting of trees and deforestation worldwide is often not conducted legally, or in a responsibly managed way.

The high costs of Illegal Logging

Illegal logging can lead to severe deforestation and forest degradation. The companies engaged in illegal logging can force their workers to endure unacceptable labour conditions. They ignore the rights of local and indigenous communities.

Illegal logging also perpetuates corruption and social conflict, destroys livelihoods and deprives governments of revenue.

It disadvantages legitimate businesses, including those in Australia, by undercutting market prices and threatening local investment, profitability and jobs.

In 2014, the United Nations Environment Program estimated the value of illegal logging to be US$100 billion annually, or up to 30 per cent of the total global timber trade. In some countries illegally logged timber could account for up to 70 per cent of the total timber produced and this means that developing countries could be losing around US$23 billion every year in revenue and assets.

What are the risks to businesses selling  goods made of timber that was illegally logged in Australia?

The risks to a business from selling products that include timber or paper that originated in an illegally logged forest include:

1. loss of customers;
2. damage to their reputations.

The risks arise, firstly, from consumers wanting to buy responsibly sourced and produced goods and shunning products from unknown, unsustainable or illegal sources and the suppliers of such products.

Consumers are more conscious of where products come from, the impacts of their manufacture and production and are becoming more discerning in what they buy. Architects and designers are more often specifying timber that is credibly certified as sustainable in their designs and with more developers reaching for green star ratings and certification, suppliers knowing the history and provenance of their timber goods is becoming more important.

The second, and probably bigger, risk to businesses is if environmental organisations decide to publicise the fact that timber, or paper products they sell are sourced from illegally logged forests, or that the harvesting of the timber is impacting habitat of  animals, for example koalas, Leadbeater’s possums, orang-utans.

If the seller is also the importer they can be breaking the law.

What can businesses do to remove the risk from selling illegally logged timber?

Under the Illegal Logging Prohibition Act, companies importing timber (and paper) products into Australia, or processing Australian harvested timber, must conduct due diligence on the source of the timber and not import or process the timber goods. The US and Europe have similar laws.

Importers and processors need to be sure that the timber has the documentation and evidence to show that it was legally logged.

Sellers of timber or paper products should ask their suppliers to provide evidence that the trees that made up the products they sell have been legally logged.

For assistance in conducting and reviewing timber due diligence programs, contact us at Ascentia Sustainability.