1. Percentage System FSC-STD-40-004V2 Key Topic Version: 19 Sep 2008

2. 2 1234567 Contents Definition of the Percentage System Defining FSC Product Groups Inputs to the Percentage System The System FSC-labeling Sales & FSC Claims Exercises

3. 3 Outputs may be sold with an FSC percent claim based on the percent of FSC-certified and/or post-consumer reclaimed inputs used during the claim period Total outputs in product group may be sold with the FSC percent claim FSC percentage based on inputs to one FSC product group FSC percentage based on inputs at a single site Typical for –Batch production –High volume of FSC / PCR supply 1. Definition 1 of 3 optional systems for making FSC Product Group claims

4. 4 Important Terms: 1. Definition Conversion Factor (C.F.) Ratio between input and output volume of a product/component Controlled Wood (CW) FSC CW – non-FSC virgin material controlled by an FSC-certified organization Controlled material – non-FSC virgin material controlled by the organization using the input Eligible Input Inputs eligible for use in FSC Product Groups (see material category) FSC Claim FSC Pure, FSC Mixed X%, FSC Mixed Credit, FSC Recycled X%, FSC Recycled Credit, FSC Controlled Wood Material Category Category of inputs: FSC Pure, FSC Mixed, FSC Recycled, FSC CW, Controlled material, post-consumer reclaimed, pre-consumer reclaimed (Uncontrolled material is ineligible) Minor Component Uncontrolled wood-based component <5% of the product volume and specifically approved for use in an FSC Product Group Site A single physical unit located at one locality, geographically unique from other units Post-consumer Reclaimed (PCR) Reclaimed from a consumer or commercial product that has gone through its final end-use

5. 5 One FSC Product Group shares the same basic input characteristics –Species –Quality of inputs –Conversion factor Product groups may be defined individually based on customer order and single percent calculations General product groups shall be approved by the CB and represented in the Product Group Schedule (PGS) 2. Defining FSC Product Groups A variety of components and species may be used in one product group provided they are consistent Define product groups for which FSC percent claims apply

6. 6 All eligible inputs are possible 3. Inputs Input Material Category Potential FSC Claims FSC Pure FSC Mixed X% FSC Mixed FSC Mixed X% FSC Recycled FSC Mixed X%, FSC Recycled X% FSC Controlled Wood FSC Mixed X% Post-consumer / Pre-consumer Reclaimed FSC Mixed X%, FSC Recycled X% Controlled Material FSC Mixed X% Minor Component FSC Mixed X% It is possible to make FSC Controlled Wood claims for any eligible inputs/combinations

7. 7 transformed Inputs of different material categories are transformed with an FSC percentage claim calculated based on input volumes, e.g., Input Material Categories FSC Claim FSC Pure + controlled material FSC Mixed X% FSC Mixed + FSC Mixed FSC Mixed X% FSC Recycled + Pre-consumer FSC Recycled X% 4. The System

8. 8 combined OR, inputs from different material categories are combined with an FSC percentage claim calculated based on input volumes, e.g., Input Material Categories FSC Claim FSC Pure + FSC Mixed FSC Mixed X% FSC Mixed + FSC Controlled Wood FSC Mixed X% Post-consumer + Pre-consumer FSC Recycled X% 4. The System Note: the percentage system cannot be used for the trading of finished products

9. 9 Ensuring traceability In space –Secure, identifiable –Storage areas –Production lines –Facilities In time –Job orders –Claim periods Identification Labeling / marking Identification Labeling / marking Segregation Documentation Percentage system requires segregation of inputs by FSC Product Group (inputs for the same product group may be co-mingled) 4. The System

10. 10 Transfer system - essentials Purchasing & ReceivingProcessingFinal Storage & Sales Specify material category Check supplier documentation for FSC claim Ensure distinguishing marks (labels) Record volume in tracking system &/orUse distinguishing marks, &/or Distinct batch runs Record time period Record input volume according to category Record FSC percent calculation (using the input % / credit claim) Record conversion &/orUse distinguishing marks (labels), &/or Designated areas FSC % claimMake FSC % claim Record volume in tracking system: inventory, sales Final product cross- references with invoice & transport docs 4. The System

11. 11 Calculation of the Input Percentage 4. The System FSC + PCR Inputs Total Inputs FSC Percentage Claim = X 100 InputDescription FSC FSC Pure, FSC Mixed, FSC Recycled PCR All verified post-consumer reclaimed inputs Total FSC + any reclaimed + any controlled (all eligible material categories)

12. 12 55cbm FSC Pure 25cbm FSC CW = 80cbm 55 / 80 =.6875 X 100 FSC Mixed 69% = 75cbm FSC Recycled 12cbm pre-consumer = 87cbm 75 / 87 =.862 X 100 FSC Recycled 86% = 4. The System Calculation of the Input Percentage

13. 13 FSC Mixed Credit 55cbm FSC Recycled 85% 90cbm FSC CW 30cbm 4. The System Calculation of the Input Percentage 55 + 90(.85) cbm 160 cbm FSC Percentage Claim = X 100 FSC Mixed 82%

14. 14 4. The System The maximum claim period is 12-months Two options for calculating the FSC percent claim Continuous production Fluctuating input proportions Claim periods are overlapping and continuous Claim periods include defined intervals of time for calculating the percentage Accumulated inputs during the interval represent the FSC percent claim (FSC claim is based on average) Typical for isolated production, customer orders, or assembled units One calculation based on total inputs to that production Claim periods are often isolated or defined as job orders FSC percent claim is actual Single percentage calculation Rolling average percentage calculation

15. 15 4. The System Claim period can be any length of time up to 12-months as long as the same FSC percentage claim is made and is based on inputs used for making individual claims, i.e., on the invoice. 12-month claim periods are used when there is devoted production and sales of the same FSC Product Group. If FSC production and sales are intermittent: –The claim period equals the length of time for isolated production: receipt of material – production – sales OR –Job order is specified Percent calculation is based on the inputs used for individual claims. 8.3.2(a) Single Percentage Claim Most common option

16. 16 4. The System Define / specify: 1.Intervals 1.Intervals of time for percentage calculation based on inputs during that defined interval; 2.Claim period 2.Claim period for making a percentage claim based on the percent calculation from the previous interval and for output volumes up to (<) the interval’s input volumes The interval shall end before the corresponding claim period begins, but claim periods and intervals are continuous and overlapping: 2 month intervals with 1 month claim period 8.3.2(b) Rolling Average Percentage Claim JANFEBMARAPRMAYJUN FSC % claim for Jan – Feb % calc FSC % claim for Feb – Mar % calc FSC % claim for Mar – Apr % calc FSC % claim for Apr – May % calc

17. 17 4. The System Claim period is the length of time that the company will make the same FSC percentage claim for that product group. The percentage calculation and claim are based on a defined interval of time that takes place prior to when the claim period begins. Company determines: –What is the interval of time that will give the desired average percentage claim? –What is the length of time needed for selling products with the same percentage claim for a volume up to the total input volume in the specified interval? If any material is used for non-FSC sales, that volume cannot contribute to the percentage calculation. FSC Claims made during the claim period are based on inputs from an earlier interval of time (just prior to when the claim period begins) Inputs to the product group shall always be eligible and shall be the same, otherwise this will constitute a different FSC product group. 8.3.2(b) Rolling Average Percentage Claim More details…

18. 18 5. Sales & FSC Claims The invoice essentials Transport / shipping documents Each FSC Product Group is clearly identified with the applicable FSC percent claim FSC certificate code of the Organization is clearly represented –SW-COC-00XXXX for “FSC Mixed X%”, “FSC Recycled X%” –SW-CW-00XXXX for “FSC Controlled Wood” Same details required for transport docs when invoice does not accompany product

19. 19 6. FSC-labeling FSC Mixed = any combination of eligible inputs, including some virgin content To apply a variation of the FSC Mixed Sources label the FSC Mixed percent shall be: 1.FSC Mixed 70% (or greater) 2.FSC Mixed 50% (or greater for chip and fiber until end of 2009) The FSC Mixed 50% minimum for chip and fiber products is covered by FSC-ADV-40-004 FSC Mixed Sources Label (FSC Mixed)

20. 20 FSC Recycled Label 6. FSC-labeling FSC Recycled = 100% reclaimed content (may include some pre-consumer) To apply the FSC Recycled label the FSC Recycled percent shall be: FSC Recycled 85% FSC Recycled 85% (or greater) Label shown here is minimum elements style required when less than 100% post-consumer Recycled Cert no. SW-COC-00XXXX © FSC 1996 NB: the recycled % in the moebius loop (when included) always refers to post-consumer reclaimed content 85%

21. 21 NB! FSC Recycled or FSC Mixed? 6. FSC-labelingInputs: FSC Recycled (or post-consumer reclaimed) + Controlled Wood = FSC Mixed To apply FSC label, post-consumer percent shall be: 70% or greater (50% for chip/fiber until 2010) *FSC Recycled = 100% reclaimed Label shown here is minimum elements style required when there is no FSC virgin content Mixed Sources Cert no. SW-COC-00XXXX © FSC 1996 NB: the recycled % in the moebius loop (when included) always refers to post-consumer reclaimed content 70%

22. 22 LINK TO EXERCISES 7. Exercises Note: you must exit presentation mode and double-click on the ‘word’ icon to open exercises

23. 23 THANK YOU!