Jakarta. FSC-certified smallholders in Indonesia will muster support for the adoption of Motion 37/2021 and the rejection of Motion 45/2021 at the General Assembly of the Forest Stewardship Council (FCS) in Bali on 9-14 October.

Sosial Bisnis Indonesia (SOBI) President Commissioner Silverius Oscar Unggul said the adoption of Motion 37/2021 would help smallholders in Indonesia develop their businesses and create an inclusive ecosystem for FSC products in the country.

“We are seeing stagnation in the FSC-certified wood (product) market in Indonesia that has hampered our business growth,” Silverius said in a recent press release. 

For the record, SOBI is an inclusive company whose shares are majority owned by the Community Forest Cooperative.

At the FSC General Assembly, members will vote on a number of motions that will serve as the basis for certification of sustainable forestry management in the coming years.

One of them is Motion 37 that proposes a change in the cut-off date or deadline for authorized natural forest conversion into forest plantations from November 1994 to December 31, 2020. The change is subject to mandatory environmental and social improvements in natural forests already converted under the provisions of the Remedy Framework (RF).

The approval of Motion 37/2021 and the rejection of Motion 45/2021 will expand the application of FSC certification in forest plantations worldwide, including in Indonesia. At the same time, the Remedy Framework can also support FSC's ambition to promote the expansion of forest rehabilitation and restoration activities.

“We need to develop an expansive ecosystem of FSC products in Indonesia by involving more entrepreneurs, from small and medium to big players, so FSC products can flourish in Indonesia,” Silverius said.

Silverius, who is also Deputy Chairman for Environment and Forestry, Indonesian Chamber of Commerce and Industry, dismissed the allegations that if adopted, the motion will reduce the competitiveness of the products of FSC-certified smallholders.

“So far, we are the only company to have strived to raise public awareness about FSC in Indonesia and it is quite difficult. Our production is stagnating, and there is even a tendency for a decline, forcing members of the cooperative to resort to illegal logging.”

PT SOBI has quite a unique history. The company is the end result of a strategy to deal with illegal logging. Previously, most of Jaya Lestari Forest Cooperative (KHJL) were illegal loggers. 

Silverius and his business partners, in collaboration with Tropical Forest Trust (TFT), succeeded in convincing illegal loggers to metamorphose into sustainable forest managers. At the time, KHJL was a pilot project for community-based sustainable forest management as well as the site for the launch of the Social Forestry program. Small wonder that this small cooperative in South Konawe was granted FSC certification in 2005.

Following the success in South Konawe, Silverius and his business partners replicate the management model in Yogyakarta, Java. The replication was a success and in 2008, the Wahana Lestari Menoreh Cooperative (KWLM) was granted FSC certification.

Initially, managing two FSC-certified cooperatives seemed lucrative, given the high demand for logs and adequate supply from cooperative members. The model inspired thousands of illegal loggers to join as members of the cooperatives and sustainable forest managers.

However, the growing number of members was not followed by the growth in the FSC-certified wood (product) market in Indonesia. 

Silverius and his business partners tried everything possible to ensure that the FSC-certified wood (product) market in Indonesia could grow, but the situation was way beyond the capacity of Perkumpulan Telapak, the organization of which Silverius is a member. 

The only way out was to take efficiency measures by integrating the management of the cooperatives into a company, namely SOBI. SOBI is the group manager of the cooperatives and is responsible for the marketing program and certification process.  To maintain inclusiveness, PT.  SOBI’s shareholders comprise not only people's cooperatives but also investors and professionals.

The establishment of PT. SOBI as an efficiency measure has proven to be quite effective in reducing costs and also strengthening the bargaining power in the market.  However, the main problem, namely encouraging the development of the FSC-certified wood (product) market in Indonesia, has remained unsolved.

“An ecosystem has yet to be created because not many business actors are interested in FSC.  Even though nearly all big brands such as Starbucks, McDonald’s and Tetrapak require FSC-certified products, no Indonesian company is involved because these big brands use imported paper products.”

Therefore, in conjunction with the FSC General Assembly in Bali, Silverius and all SOBI stakeholders hope that FSC members vote for the adoption of Motion 37/2021 and reject Motion 45/2021 to encourage more business actors in Indonesia to become FSC members. This will facilitate the creation of an ecosystem for the FSC-certified wood (product) market in Indonesia. 

“We believe that the more stakeholders show interest, the faster the ecosystem will be created. Community forest products have their own characteristics and types and we are confident that they can compete in the market,” he said.

“We hope the open market will inspire more illegal loggers to metamorphose into sustainable forest managers,” said Silverius.

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