Study finds role of company procurement policies increasing, but focus still on certification

Private-sector procurement policies are becoming more prominent in the global North and among companies with global reach, according to a report released recently by the Independent Market Monitor (IMM). Increasingly, private-sector actors are taking steps to exclude unsustainable and illegal wood from their supply chains, with certification at the forefront.

The IMM is a multiyear programme funded by the European Union (EU) and managed by ITTO. IMM’s role is to use trade-flow analysis and market research to independently assess the trade and market impacts of the EU’s Forest Law Enforcement, Governance and Trade (FLEGT) initiative’s voluntary partnership agreements (VPAs).

A literature review conducted for the study identified more than 100 organisations, tools, initiatives, templates and sets of guidance that could influence company procurement policies. Sixty-five of these potential sources of influence were assessed to identify attitudes and support for key indicators such as certification, legal compliance, and EU FLEGT licensing. The study also analysed the responsible purchasing policies of 20 large EU-based companies in a range of sectors—from retail to timber importing—to determine the levels of support for FLEGT licensing. Interviews were conducted with trade associations, timber distributors and civil-society organizations to further explore their views.

Support for FLEGT Licencing is yet to match forest certification
The study found that support for FLEGT licensing is yet to reach the level achieved by forest certification. More than 70 per cent of the assessed influential sources were positive and explicit in their support for some or all forms of forest certification, compared with around 40 per cent that supported FLEGT licensing.

FLEGT licensing, when considered as a brand, was found to have fewer of the advantages of forest certification. For many of the companies and organizations interviewed and analysed, FLEGT licensing therefore remains unproven in terms of its value and performance on the ground. Moreover, it is often unobtainable.

The nature of the EU Timber Regulation and its universal application in all EU countries should ensure that it carries status and meaning in the market, regardless of whether corporate policies confer additional status upon it. The reality is, however, that FLEGT-licensed timber is still a niche product, and even those working within the niche show varying levels of support, belief and trust in the “FLEGT brand” and what it stands for.

The report makes the following recommendations to boost the value of FLEGT-licensed materials in EU markets:

  • Communicate relevant results of independent monitoring and evaluation of systems underlying FLEGT licences in a timely manner and in a format that is appealing to the private sector
  • Actively engage those civil-society organizations and private-sector organizations seeking to influence private-sector procurement policies
  • Support the efforts of the private sector in FLEGT countries, especially those with active timber legality assurance systems, to promote the benefits and positive impacts of such systems
  • Speed up the introduction of FLEGT-licensed timber from countries with VPAs with the EU