The FSC created nine “principles” (later expanded to 10) and more detailed “criteria” that are performance-based, broad in scope and that address tenure and resource use rights, community relations, indigenous peoples, workers’ rights, environmental impact, management plans, monitoring and conservation of old growth forests, and plantation management (See Moffat 1998: 44; Forest Stewardship Council 1999). The FSC program also mandated the creation of national or regional working groups to develop more specific standards based on the broad principles and criteria.
The FSC program is based on a conception of NSMD governance that sees private sector certification programs forcing upward sustainable forest management (SFM) standards. Perhaps more important than the rules themselves is the FSC “tripartite” conception of governance in which a three-chamber format of environmental, social, and economic actors, each with equal voting rights, has emerged. At the international level each chamber is itself divided equally between North and South representation (Domask 2003). Two objectives were behind this institutional design. The first was to prevent business dominance in policy-making processes in the belief that this would encourage the development of relatively stringent standards, and facilitate on-the-ground implementation. The second was to ensure that the North not dominate at the expense of the South – a strong criticism of the failed efforts at the Rio Earth Summit to achieving a binding global forest convention (Domask 2003; Meidinger 1997; Meidinger 2000).34
The lumping together in one chamber those economic interests (i.e., companies and non-industrial forest owners) who must actually implement SFM rules with companies further along the supply chain who might demand FSC products has been the source of much controversy and criticism. It has negatively affected forest owners evaluations of the FSC (Sasser 2002; Rametsteiner 1999) and encouraged the development of “FSC alternative” certification programs offered in all countries in North American and Europe where the FSC has emerged. In the US, the American Forest and Paper Association created the Sustainable Forestry Initiative (SFI) certification program. In Canada, the Canadian Standards Association (CSA) program was initiated by the Canadian Sustainable Forestry Certification Coalition, a group of 23 industry associations from across Canada (Lapointe 1998). And in Europe, following the Swedish and Finnish experiences with FSC-style forest certification, an “umbrella” Pan European Forest Certification (PEFC) system (renamed the Program for the Endorsement of Forest Certification in 2003) was created in 1999 by European landowner associations that felt especially excluded from the FSC processes.
In general, FSC competitor programs originally emphasized organizational procedures and discretionary, flexible performance guidelines and requirements (Hansen and Juslin 1999: 19). For instance, the SFI originally focused on performance requirements, such as following existing voluntary “best management practices” (BMPs), legal obligations, and regeneration requirements. The SFI later developed a comprehensive approach through which companies could chose to be audited by outside parties for compliance to the SFI standard, and developed a “Sustainable Forestry Board” independent of the AF&PA with which to develop ongoing standards. And similar to the SFI, the CSA focus began as “a systems based approach to sustainable forest management” (Hansen and Juslin 1999: 20) where individual companies were required to establish internal “environmental management systems” (Moffat 1998: 39). The CSA allows firms to follow criteria and indicators developed by the Canadian Council of Forest Ministers, which are themselves consistent with the International Organisation for Standardization (ISO) 14001 Environmental Management System Standard and include elements that correspond to the Montreal and Helsinki governmental initiatives on developing criteria and indicators for sustainable forest management. (While more flexible and discretionary than FSC on environmental performance requirements, some industry officials assert that the CSA is as rigorous on rules for community consultation and a multi-stakeholder standards development process than the FSC’s requirements).
The PEFC is itself a mutual recognition program of national initiatives and draws on criteria identified at the Helsinki and Lisbon Forest Ministers Conferences in 1993 and 1998, respectively (PEFC International 2001). National initiatives are not bound to address the agreed upon criteria and indicators (Ozinga 2001), as the PEFC leaves the development of certification rules and procedures to the national initiatives. A PEFC Secretariat and Council that tends to be dominated by landowners and industry representatives determine the acceptance of national initiatives into the PEFC recognition scheme (Hansen and Juslin 1999). From the start, the program was explicitly designed to address forest managers’ universal criticisms that the FSC did not take sufficient account of private landowners’ interests.
These FSC-competitor programs initially operated under a different conception of NSMD governance than does the FSC: one that is grounded in the belief that business interests ought to strongly shape rule-making, with other nongovernmental and governmental organizations acting in advisory, consultative capacities. Underlying these programs is a strongly held view that there is incongruence between the quality of existing forest practices and civil society’s perception of these practices. Under the SFI, CSA, and PEFC conceptions, certification is, in part, a communication tool that allows companies and landowners to better educate civil society. With this conception procedural approaches are ends in themselves, and individual firms retain greater discretion over implementation of program goals and objectives. This conception of governance draws on environmental management system approaches that have developed at the international regulatory level (Clapp 1998; Cutler, Haufler, and Porter 1999).
Table 2: Comparison of FSC and FSC competitor programs in Canada
Terms: Performance-based refers to programs that focus primarily on the creation of mandatory on the ground rules governing forest management, while systems-based refers to the development of more flexible and often non-mandatory procedures to address environmental concerns. Third Party means an outside organization verifies performance; Second Party means that a trade association or other industry group verifies performance; First Party means that the company verifies its own record of compliance. Chain of Custody refers to the tracking of wood from certified forests along the supply chain to the individual consumer. A logo is the symbol certification programs use to advertise their programs and can be used by companies when making claims about their forest practices. An eco-label is used along the supply chain to give institutional consumers the ability to discern whether a specific product comes from a certified source.
Key Features of NSMD Environmental Governance
Six key features distinguish NSMD governance from other forms of public and private authority. The most important feature of NSMD governance is that there is no use of state sovereignty to enforce compliance. The Westphalian sovereign authority that governments possess to develop rules and to which society more or less adheres (whether it be for coercive Weberian reasons or more benign social contract reasons), does not apply. There are no popular elections under NSMD governance systems and no one can be incarcerated or fined for failing to comply. Rather, a private organization develops rules designed to achieving pre-established objectives (sustainable forestry, in the case of forest certification).
Table 3: Key Features of NSMD governance
Role of the state
State does not use its sovereign authority to directly require adherence to rules
Source: Cashore (2002) and Bernstein and Cashore (2004)
A second feature of NSMD governance is that its institutions constitute governing arenas in which adaptation, inclusion, and learning occur over time and across a wide range of stakeholders. The founders of NSMD approaches, including forest certification, justify these on the grounds that they are more democratic, open, and transparent than the clientelist public policy networks they seek to replace. A third key feature is that these systems govern the “social domain” (Ruggie 2003)– requiring profit-maximizing firms to undertake costly reforms that they otherwise would not pursue. This distinguishes NSMD systems from other arenas of private authority, such as business coordination over technological developments (the original reason for the creation of the International Organization for Standardisation) that can be explained by profit seeking behavior in which reduction of business costs is the ultimate objective. To be sure, these arenas are important, but they are very different beasts, with very different authority mechanisms, than NSMD systems.
The fourth key feature is that the various stakeholders, including environmental groups, companies, and landowners, make their own evaluations about whether to grant authority to these news systems. These evaluations are affected or empowered by the fifth key feature of NSMD governance: authority is granted through the market’s supply chain. Much of the FSC’s and its domestic competitors’ efforts to promote sustainable forest management (SFM) are focused further down the supply and demand chain toward those value-added industries that demand the raw materials, and ultimately, toward retailers and their customers (Bruce 1998: chapter 2; Moffat 1998: 42-43). While landowners and forest companies may be appealed to directly with the lure of a price premium or increased market access, environmental organizations may act through boycotts and other direct action initiatives to convince large retailers, such as B&Q and Home Depot, to adopt purchasing policies favoring the FSC, thus placing more direct economic pressure on forest managers and landowners. The sixth key feature of NSMD governance is the existence of verification procedures designed to ensure that the regulated entity actually meets the stated standards. Verification is important because it provides the validation necessary for certification program to achieve legitimacy, as certified products are then demanded and consumed along the market’s supply chain. This final feature distinguishes NSMD systems from many forms of corporate social responsibility initiatives that require limited or no outside monitoring (Gunningham, Grabosky and Sinclari 1998: Chapter Four).