Module 4 Procuring sustainable timber Training on procurement for SMEs Alba Julia, 1 st November, 2012

STA guidelines on legal and sustainable timber supply How to cope with a public tender procedure for sustainable timber The verification requirements and commitment communication  this following model has been designed for the procurement of timber and timber products, NOT for PAPER  these criteria are recommendations that can be easily adapted to the procurement model of the contracting authority Objectives

The standard sustainable timber supply model Meeting public demand for legal, sustainable and/or recycled timber

Tender sections Subject matter – this is the “title” of the contract, and describes what is being procured. It may well include a reference to sustainability Technical specifications - These provide a detailed description of precisely what the public authority wishes to purchase. It indicates the minimum standard which the bidder must meet. Award/evaluation stage – At this stage, all the offers which meet the minimum standard outlined in the technical specification are compared. Some authorities compare on price alone. Contract clauses – These provide the rules which the supplier must follow once they have been awarded the contract. A sample contract should be supplied with the original Invitation to Tender.

Legality is a first criteria for timber public procurement. The trend in public procurement policy is to ask preference for sustainable timber and exclude those suppliers that cannot provide evidence of legality within the timber supply chain. The European Union is tackling this issue through the Forest Law Enforcement, Governance and Trade Action Plan (FLEGT) and the main mechanisms are: - Voluntary Partner Agreements (VPAs) and the - European Union Timber Regulation (EUTR). Legal timber

From March 2013 the EUTR will prohibit placing timber on the EU market if it was illegally harvested. Anyone placing timber or timber products onto the EU market for the first time must implement a Due Diligence System (DDS) to mitigate the risk that the timber was illegally harvested, providing:  Information on the product and supplier, the country where the timber was harvested and information on compliance with applicable forestry legislation in the country of harvest must be available.  Risk assessment procedure: Each operator is required to have a risk assessment procedure which takes into account the information collected and relevant risk criteria.  Risk mitigation procedures: Where the risk assessment indicates that there is some risk of a product containing illegally harvested timber, risk mitigation procedures must be put in place. Legal timber – the EUTR For more information :

Requirement Technical specifications The [timber product] shall comply with the following conditions: At least 70% of the raw material of the [timber product] must come from sustainably managed sources, in line with the principles defined by FOREST EUROPE (MCPFE): 1.Management of the forest must ensure the: 2.Maintenance and appropriate enhancement of forest resources and their contribution to global carbon cycles; 3.Maintenance of forest ecosystem health and vitality; 4.Maintenance, conservation and appropriate enhancement of biological diversity in forest ecosystems; 5.Maintenance and appropriate enhancement of protective functions in forest management (notably soil and water); 6.Maintenance and encouragement of productive functions of forests (wood and non wood) Sustainable sources

Verificator The contractor [supplier, bidder] must be able to provide either: An invoice containing a valid FSC or PEFC CoC number linked to the product in question specifying the percentage of certified material* Any equivalent means of proof** Timber for sustainable management

Requirement Technical specifications The [timber product] shall comply with the following conditions: The product is made from at least 85% of post- or pre- consumer (c) recycled material. The remaining material must come from legal sources. Recycled sources

Verification Post- or pre-consumer recycled material The contractor [supplier, bidder] must be able to provide: credible documentation which specifies the percentage of recycled content. An invoice containing a valid FSC or PEFC CoC number linked to the product in question, with a declaration specifying the percentage of recycled content*** any other equivalent means of proof

Up to 20 points* will be awarded to [timber product(s)] where more than 70% of the raw material comes from sustainably managed sources. 20 points will be awarded to products containing 100%. 0 points will be awarded to products containing 70%. Points will be awarded on a sliding scale in between. * number of points allocated to this award criterion will depend on the typical procurement model of the contracting authority, and the importance which they wish to give to it. Requirement Award criteria

Verification The contractor [supplier, bidder] must be able to provide either: An invoice containing a valid FSC or PEFC CoC number linked to the product in question specifying the percentage of certified material, or. Any equivalent means of proof.

Between legality and sustainability Controlled wood Timber and other derived wood products that exclude the following categories: 1.Illegally harvested wood 2.Wood harvested in violation of traditional and civil rights 3.Wood harvested in forests in which High Conservation Values (areas particularly worth of protection) are threatened through management activities 4.Wood harvested from conversion of natural forests 5.Wood harvested from areas where genetically modified trees are planted The contractor [supplier, bidder] must be able to provide an invoice containing a valid FSC CoC number for Controlled Wood linked to the product in question Verification

Between legality and sustainability Non controversial wood Timber and other derived wood products that comply with local, national, or international legislation, in particular relating to the following areas: 1.forestry operations and harvesting, including conversion of forest to other uses; 2.management of areas with high environmental and cultural values designed and covered by the legislation; 3.protected and endangered species, including requirements of CITES;CITES 4.health and labour issues relating to forest workers; 5.property, tenure and use rights of indigenous peoples; 6.payment of taxes and royalties; and 7.areas utilizing genetically modified organisms. The contractor [supplier, bidder] must be able to provide an invoice containing a valid PEFC CoC for non controversial sources linked to the product in question. Verification

Social sustainability requirements in the procurement policy FSC and PEFC require compliance with the ILO conventions throughout the timber supply chain, and respect for the traditional rights of indigenous groups. Where alternative means of proof is provided, a contract clause may be necessary to require the contractor to provide additional proof in relation to the social criteria during the contract period.

Optional contract clause for social sustainability (the text) All [timber products] shall originate from a forest source where management of the forest has full regard for: Identification, documentation and respect of legal, customary and traditional tenure and use rights related to the forest; Mechanisms for resolving grievances and disputes including those relating to tenure and use rights, to forest management practices and to work conditions; and Safeguarding the basic labour rights and health and safety of forest workers. Requirement

Verification clause for social sustainability ? If requested by [the Contracting Authority] the Contractor [supplier, bidder] shall provide evidence that [timber products] supplied or used in the performance of [the Contract] comply with this requirement. Acceptable proof would include: An invoice containing a valid FSC or PEFC CoC number linked to the product in question. Any equivalent means of proof

How to check an invoice containing a valid FSC or PEFC CoC number linked to the product in question.

A sample invoice including FSC certified products [idem for PEFC] Optional

FSC international free database Company nameFSC certification code Eg. AAA – COC – ProductsTimber speciesCountry Certificate status: valid, suspended, withdrawn… FSC license code Eg. FSC-C00xxxx

PEFC international free database Company namePEFC certification numberCountry Certificate status: recognised, not recognised…

SMEs and communities in the South face extreme difficulties in competing with large forest companies. Thus a more fair and ethical trade would allow SMEs and community products to enter the global market. Fair Trade coupled with sustainable forest sources might be a way of recognising and supporting SMEs and community sourced timber. Examples of initiatives that combine sustainable forest management and fair trade certification are: COPADE FORCERT FAIRTRADE KAHRS Going further... Fair Trade

Award criteria about fair trade 20 points * will be awarded to [timber product(s)] produced according to the parameters of the European Parliament Resolution on Fair Trade and Development (2005/2245(INI)). * number of points allocated to this award criterion will depend on the typical procurement model of the contracting authority, and the importance which they wish to give to it. Requirement Going further...

criteria (the text) for fair trade The contractor [supplier, bidder] must provide either: Products carrying a Fairtrade label (Fairtrade Labelling Organizations International) Products imported and distributed by Fair Trade Organizations (recognised by World Fair Trade Organization) Any equivalent means of proof Verification

Going further... Coping with other policy goals Some companies might be preferred by local authorities when delivering their timber products together with awareness raising activities related to sustainability issues and fairness in the forestry and timber sector. These activities may target staff of the administration, local businesses or the local community (or all three). ‘Purchase of [product] made of sustainable and/or recycled timber, together with accompanying awareness raising activities’

The contractor [supplier, bidder] must provide a short and structured description of the type of activities planned for the duration of the contract (max 4 pages) Verification Requirement Up to 10 points will be awarded to suppliers offering awareness raising activities targeting on the topic of sustainable timber/fair trade. Points will be awarded on the basis of likely effectiveness of the activities proposed

Supporting other policy goals 1.Raising awareness of sustainable timber through procurement Examples Responsible timber in construction/building works Timber is not typically purchased by the authorities themselves but rather by the construction companies To request that the timber used meets the standards outlined in the guide, and require the contractor to present proof. E.g % of the timber provided by members of the UK Timber Trade Federation -> London 2012 Olympic Park and Velodrome

More often public authorities may ask for proof of compliance with international labour standard or even better social standards. Going further... Additional social targets

In order to reduce carbon emissions and to meet climate change policy targets some public authorities may prefer suppliers which are able to demonstrate that the timber or part of the supplied products comes regional timber businesses. Going further... Locally sourced timber

A contracting authority might want to contribute to community forest development by asking for products originating from forest managed by community groups which can assure both social and environmental standards. Going further... Community sourced timber  STA guide for forest communities Example Example: FSC 100% from Community or SLIMF sources (north and south); Opportunity for FTOs that seek to trade FSC products that comes from small or community forests Available from 2012

EXCERCISE???