Can you manage forests well and still make money?


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As the old saying goes, we have some good news and some bad news.

First, the good news. A growing number of companies have started to improve their forest management practices. Markets for environmentally-friendly forest products are growing. Political pressure continues to mount for implementing forest certification schemes, particularly in Europe. The desire to protect their corporate image has made large forest product purchasers more concerned about how the companies they buy from manage their forests. Some companies use improved forestry practices to develop new markets or protect existing markets, raise the quality of their products, take advantage of raw materials previously regarded as waste, enhance their public image, avoid conflicts with government agencies, and, in a few cases, obtain higher prices. Managing forest plantations well can lower production costs.

Now for the bad news. You cannot just change a couple of things and expect to make money. Managing forests both sustainably and profitably requires hard work. It costs more to sustainably manage natural forests for timber, particularly in the tropics. Few prices premiums exist for certified forest products. Major forest product markets in Asia, Latin America, and the United States show little environmental sensitivity. To make a go of it, companies must be well managed, efficiency conscious, have aggressive marketing strategies, and preferably be able to differentiate their products from those of their competitors. Sustainability cannot be an after-thought. It must permeate the company’s entire operation. Your average fly-by-night saw mill in the Brazilian Amazon or Cameroon need not apply.

These are a few of the conclusions from Michael Jenkins and Emily Smith’s compelling new book called ’The Business of Sustainable Forestry’. The book builds off case studies of 21 companies as well as background studies on forest product markets, certification, and technological change. The cases range from well-known multinationals such as Weyerhaeuser, Home Depot, and Stora to small family – owned forests. Most come from North America and Europe, although a few Brazilian and Costa Rica cases are in there as well. The book, while bullish on sustainable forest management, goes beyond mere propaganda into the intricacies of real – life management. Besides telling glowing stories about satisfied customers and innovative new products it talks about estate taxes, fluctuating markets, cost over-runs, marketing failures, and each market’s specific quirks.

We leave it to you to decide whether the glass is half full or half empty. No matter how you are predisposed in that regard, however, you will be better informed after reading this book.


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Further reading

If you wish to contact Michael Jenkins at his new organization, Forest Trends, to comment on this message or for information on how to purchase his new book, you can write him at:

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