1. Global Forest Footprints Can they lead the way to more integrative forest governance? Dr. Constance L McDermott James Martin Senior Fellow Environmental Change Institute, U of Oxford Presentation for the Institute of Forest and Environmental Policy University of Freiburg April 18, 2013

2. 1.Framing the problem – Two contrasting perspectives 2.Reviewing progress – History of international forest governance from both perspectives 3.Conclusions – Towards an integrative approach? Agenda

3. Problem-framing #1 (FAO 2006) RED countries losing forests > 0.5%/year Deforestation accounts for >18% of global emissions (Stern 2007) Associated loss of biodiversity, local livelihoods DIRECT CAUSE, #1: Agro-industrial expansion Especially palm oil, soy, cattle INDIRECT CAUSE: Timber harvest DRIVERS: Industrial Trade & Governance (Stern 2007; DeFries et al 2010; Geist and Lambin 2002)

4. Problem-framing #1 “TRADING UP” (Vogel 1997) THE PROBLEM IS OVER THERE Inadequate environmental standards in developing countries Inadequate economic incentives for conservation THE SOLUTION IS MARKET GLOBALIZATION Trade-based approaches to environmental governance will incentivize forest protection Countries and firms with higher environmental standards demand a level playing field This leads to a “ratcheting up” of environmental standards

5. Trading up hypothesis Not prescriptive Most prescriptive Policy approach: –No rules –Voluntary Procedural Substantive thresholds –Mandatory Procedural Substantive thresholds Indicator: Prescriptiveness of environmental rules

6. Problem Framing #2 “GLOBAL FOOTPRINTS”

7. E.g. Forest Footprint Source: Rice 2007

8. E.g. Carbon Footprint (net imports > 30% of emissions for top EU countries) Source: Davis and Caldeira 2010

9. Problem Framing #2 GLOBAL FOOTPRINTS THE PROBLEM IS OVER HERE – Excessive consumption, unequal distribution of costs and benefits » e.g. per capita forest product consumption 18X higher in developed than developing countries (Rice 2007) THE SOLUTION IS ECOLOGICAL EQUITY – Ecologically Unequal Exchange (Hornborg 1998) » World system of global trade drives unequal concentration of wealth, environmental cost-shifting – Trade-based approaches to environmental governance will reinforce global inequities – Need to prioritize local benefit capture, reducing consumption

10. Footprint Hypothesis Indicator: Distribution of benefits Who is benefitting the most from trade- based governance interventions? – At local, landscape and global levels Footprint hypothesis predicts trade- based approaches reinforce inequities, keep actors “stuck at the bottom”

11. Reviewing Progress Three Phases of International Forest Governance – Phase I (1990--present): Sustainable forest management (SFM) E.g. forest certification – Phase II (2000--present): Legality – Phase III (2010--present): Carbon Research questions: Has each phase: – Ratcheted up environmental standards? – Increased local benefit capture? – Reduced consumption? – Reduced forest conversion?

12. Phase I SFM 1990s Forest Certification – Strategy to create market incentives for Sustainable Forest Management (SFM) “Good” Forest Practices  Certified wood products

13. Trading up? Case study: US certification standards more prescriptive than government regulations US & International certification requirements increasing in prescriptiveness over time YES ✔ (McDermott et al. 2008: Judge-Lord et al. Forthcoming)

14. Equity? Forest Management Unit (FMU level) – Standards emphasize civil society participation, worker and community benefits – Some evidence of improved working conditions (e.g. Judge-Lord et al Forthcoming; Keppe et al. 2008; de Lima et al. 2008)

15. Equity? Global distribution of certified forest (% certified), 2010

16. Equity? (FSC 2012) Landscape-level distribution: large-scale operations dominate (Ten largest FSC certificates, 2012)

17. Equity? Relevance beyond the forest sector… (Modified from http://www.oxfordmartin.ox.ac.uk/event/804)

18. Research Questions Is certification ratcheting up environmental standards? – Yes ✔ Has it supported local benefit capture? – FMU level: Yes ✔ – Global/landscape-level: Favors developed countries, large exporters (e.g. McDermott 2012) ✖ Has it reduced consumption? – Probably not ✖ Will it reduce forest conversion? – Depends on impacts of palm oil/soy/beef certification ?...

19. What are governments already doing? Latvia Poland Brazil Chile Mexico U.S. Canada Portugal Germany Sweden Finland Russia China India D.R. of Congo South Africa Indonesia Australia Japan New Zealand Source: (McDermott, Cashore & Kanowski 2010)

20. Government forest policies Biodiversity conservation – Protected areas, endangered species Forest practice rules – Riparian zones, road-building, harvest patterns, reforestation, volumes harvested Plantations Source: (McDermott, Cashore & Kanowski 2010)

21. Government forest policies Ranking of policy prescriptiveness (Scale 0-10 (most prescriptive)) PublicPrivateAverage Developed8.83.46.1 e.g. Finland, Bavaria 4 Transitioning/De veloping 6.86.06.7 e.g. Latvia9 Source: (McDermott, Cashore & Kanowski 2010)

22. Phase II Legality 2000s Focus on “illegal logging” – The problem is inadequate legal compliance in developing countries – The solution is better law enforcement (World Bank 2006; Seneca Creek Associates & Wood Resources International 2004)

23. Phase II Legality Legality initiatives focus on strengthening forest law in developing countries Includes international trade-based strategies, e.g.: – EU Forest Law Enforcement, Governance & Trade (FLEGT) (2005) Bi-lateral Voluntary Partnership Agreements – Require “legality licensing” of timber entering the EU – EU Timber Regulation No. 995/2010 Prohibits imports of illegal wood

24. Case study: FLEGT Voluntary Partnership Agreement (VPA) signed with Indonesia – What is legal? Timber concessions able to meet extensive planning and permitting requirements Palm oil expansion – What is illegal? Other timber concessions ~ 80% of timber consumed domestically, much of it informal and hence illegal (Kishor and Lescuyer 2012) Smallholders are central to domestic trade, lack formal land and resource rights Phase II Legality (Lesniewska and McDermott Forthcoming)

25. What constitutes proof of legality? – Third party certification Who does certification favor? – As of November 2012, <30% of concession area assessed, only large operators certified – There are ~ 15,000 small-scale timber businesses in one district in central Java, alone Phase II Legality (Obidzinski et al. 2012)

26. Research Questions Will legality verification ratchet up environmental standards? – Probably (or at least compliance) (E.g. Cashore and Stone 2012) ✔ Will it support local benefit capture? – So far, favors large-scale, export-oriented production ✖ Will it reduce consumption? – Probably not significantly ✖ Will it reduce forest conversion? – Will it spill over to other sectors ?...

27. Forests and climate Reducing emissions from deforestation and degradation and forest enhancement (REDD+) – Bali Decision (UNFCCC 2007) sets path towards REDD+ Focus on carbon accounting and finance – Cancun Agreement (UNFCCC 2010) adopts REDD+ Includes “safeguards” to protect biodiversity, local people

28. Forests and climate Verification & certification central to REDD+ Billions $$ spent on monitoring, reporting and verifying forest carbon emissions Proliferation of standards and certification schemes focused variously on carbon and safeguards (McDermott et al. 2012b)

29. Research Question Will REDD+ ratchet up environmental standards? – Probably ✔ Will it support local benefit capture? – Probably not, if exclusively trade-based Will it reduce consumption? – Probably not significantly ✖ Will it reduce forest conversion? – Conundrum: Adequate finance requires trade-based approach ?...

30. Towards integration? Greater focus on footprint perspective could… Shift focus from developing countries to global system Avoid exclusive reliance on trade-based approaches Prioritize governance reforms that benefit local actors Shift from focus on single product (e.g. timber, carbon) to entire production systems

31. Towards integration? Green/legal trade necessary but not sufficient to reduce forest footprints – Tracking, certification, verification can exacerbate global inequalities Forest sector policies inadequate to address leading cause of forest loss & overall consumption driving climate change Strategies must be assessed as part of a global system, not according to a single sector, mission (legality, carbon, etc.), or country (Finland, Indonesia, etc.)

32. Thank you!