1. Image - © Jaun Carlos Reyes/ FSC A.C.

2. AGENDA  Introduction  Research Scope  Methodology  Critical Challenges  Findings and Analysis  Recommendations  Questions/Comments 1

3. INTRODUCTION CLIENT is a non-profit organization that equips businesses with the science and resources to make products more sustainable. PROJECT GOALS DEMAND – Analyze existing procurement policies of leading corporate consumers (or buyers) of forest products in the U.S. and their requirements for sustainably managed forestry products. Identify any trends and gaps. SUPPLY – Investigate any imbalances between the amount of sustainably managed forestland and the quantity of sustainably managed forest products available in relation to demand. Determine causes and propose solutions. 2

4. RESEARCH SCOPE PAPER & PUBLISHINGPACKAGING SOLID WOOD Images (left to right): nuttakit / FreeDigitalPhotos.net, digitalart / FreeDigitalPhotos.net, tungphoto / FreeDigitalPhotos.net 3 SUPPLY from sustainably managed forests DEMAND from companies within 3 sectors with major forest product consumption

5. METHODOLOGY SUPPLY Analyze forestland composition North American acreage Ownership structure Investigate certification processes Examine supply chain structures Academic Studies Analyze interactions between: Composition Certification Process Supply Chain DEMAND Analyze corporate reporting on forest products Evaluate level of company commitment 1.Leader 2.Progressing 3.Mildly Engaged 4.Uncommitted Assess trends by company and sector Identify policy gaps and drivers 4

6. CRITICAL CHALLENGES 5 Image: danstewartconsulting.com  Scope limited to publicly available data  No trade statistics on certified products  Unable to convert acreage to yield  No standardized reporting metrics  Difficulty in assessing “soft” goals

7. SUPPLY Findings  Canada: Leader in North America  Fragmented forest ownership impacts certification level  Certification levels high in developed nations, low in developing nations  Certification level decreases along the supply chain Trends  In U.S. mainly industrial forests are certified  In U.S. certified transactions are growing Drivers (negative)  Certification costs and requirements  Complex supply chain  Limited economic payback for supply chain certifications 6 Source UNECE-FAO, 2011 and Image: fsc.org

8. SUPPLY – GLOBAL CERTIFICATION 7 Source: UNECE-FAO, 2011 Forest product certified by major certification schemes 2005-2011 Chain-of-custody certified trends worldwide 2005-2011

9. DEMAND - PAPER & PUBLISHING Findings  Several leaders > 75% certified sourcing  Supply chain certification enforcement  Initiatives to promote forest certification  Working groups: Online paper-assessment tools Trends  Private companies have fewer forestry initiatives  High and improving targets by leaders  Aggressive, new procurement strategies in 2011  Consortiums’ goal to increase forest certification Drivers  Supply bottlenecks (negative driver)  Online paper assessment tools  Reporting requirements (public vs. private) 8 Image: infobarrel.com No. of Companies

10. DEMAND - PACKAGING Findings  Prime focus not on paper-based packaging  Competing packaging materials  Sourcing policies mainly address core products (e.g. Coffee, Leather, Food)  Certification not always a priority Trends  Recycling and weight reductions dominate  Lower landfill contribution  Alternative packaging options  Few firms demand more certified products Drivers (negative)  Packaging is a secondary component  Missing price premium  Other strategies yield faster results 9 Image: salesmastercorp.com No. of Companies

11. DEMAND - SOLID WOOD (HOUSEHOLD DURABLES) 10 Findings  Market could bear a premium for certified products  Leaders focus on certification  Wood is a major component of most products Trends  Leaders show an upward trend, others remain unchanged  Trends fall into patterns of extremes  Several certification schemes are used Drivers  AHFA provides resources for member companies to implement sustainable practices  No indication of consumer demand for sustainable forest products Image: archiexpo.de No. of Companies

12. DEMAND – SOLID WOOD (Homebuilders) 11 Findings  Leaders are implementing wood product procurement policies  Reporting quality varies from comprehensive sustainability web pages, milestone tracking to imprecise CSR reports Trends  Increasing awareness for forest products  Most soft goals have no implementation timeframe  Long-term volume metrics are not reported by most companies Drivers (negative)  Economic downturn: housing market decline  Green design for functioning dominates content Image: exchange3d.com No. of Companies

13. RECOMMENDATIONS Outreach and Education Reporting Supply Chain Targeted Industry Associations 12 Foundation for Working Group Image: ecologicaldesign.net

14. Image - © Jaun Carlos Reyes/ FSC A.C.