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Supply Chain
Stopping Global Deforestation:
How to Turn Around a Giant (Part 2 of 2)

This is the fourth in a series of excerpts from Engaging Outraged Stakeholders: A How-To Guide for Uniting the Left, Right, Capitalists and Activists (Affinity Press, 2013), the new book from Future 500. Earlier this month, we posted the beginning of Chapter Two: The Power of Engagement, and learned six reasons to engage your activist stakeholders. Last week, we delved further into Chapter Two and examined a case of how engaging activists stakeholders has helped a company serve its purpose. Here, we continue with the case of Asia Pulp and Paper.

In a way, the story has just begun — APP still has to prove itself. But the success-in-process might not have happened without determined efforts by an array of NGO and corporate officials.

For example, Linda Wijaya, the granddaughter of APP’s founder who now runs the company: She painstakingly reviewed the company’s Sustainability Roadmap, line by line, before she entered into the commitment, visiting sites, consulting experts and running numbers. “Before I say it, I want to be sure I can do it,” she says. Aida Greenbury is the company’s tough, hard-charging Managing Director of Sustainability. She shuttles between the forestry activists on the one hand, the APP executive team in Jakarta, and the on-the-ground personnel now shifting their long-time practices.

To assist them APP is working with The Forest Trust (TFT), a company expert in supply chain management and sustainability having done high-profile work on palm oil and the use of sustainable timber in furniture. They employ technical experts in the field to first establish the value of the resource and help police the no deforestation commitment.

The Greenpeace campaign was led by the affable but forceful Bustar Maitar of Greenpeace Indonesia. Andy Tait of Greenpeace UK drove the campaign by orchestrating the aggressive series of direct actions against APP and its parent company Sinar Mas, mostly by targeting their customers, from Nestlé (on palm oil from Sinar Mas’s Golden Agri-Resources) to Mattel (on paperboard from APP). But he also served as the good cop, engaging top APP executives with a manner that is calm, humble, and disarming.

Lafcadio Cortesi led RAN’s campaigns focusing on prominent retailers and brands who used APP products in their supply chain. He engaged extensively with Greenbury, focusing not just on forestry practices, but also on the social and community impacts of APP’s practices.

Erik Wohlgemuth and Rebecca Busse of Future 500 worked behind the scenes with a number of the brand-name companies, advising them on how to keep the process on-track during periods of complication.

Global Nestlé Chairman Peter Brabeck also played a key role, by driving a change in palm oil procurement standards, once Greenpeace targeted his company in a gruesomely effective YouTube social marketing campaign.

Peter Heng was instrumental in clearing the way for APP to make its shift. As head of sustainability at GAR, he drove the change in palm oil practices required by Nestle’s new policy. The day GAR announced they had met Nestlé’s new standard, their share price increased significantly. The Nestlé account was small compared with GAR’s total sales, but the commitment relieved investor concerns that the company might suffer long-term declines if it could not improve its forestry practices. GAR’s success helped give APP confidence that they could meet the Greenpeace demands without major loss of business.

Scott Poynton, founding director at TFT, tracked the on-the-ground change in practices at GAR, to validate whether and how they were meeting the Nestlé commitment. TFT has 116 staff in 16 countries, including 55 in Indonesia, about 30 of whom are working on APP.

One of the most important change drivers is Mr. Teguh Ganda Wijaya, Chairman of APP, who surprised his company and environmentalists by personally announcing the shift in practices at APP. Seeing the company patriarch at the podium with Indonesia’s forestry minister to announce the commitment was “almost surreal for me … we’ve never seen that high-level support before,” according to Sutherlin of RAN.

WWF and APP came to a prior agreement on forest protection in 2004, but the process failed on the ground. To help insure that APP keeps its commitment, Brendan May, founder of Robertsbridge Group, has assembled a global stakeholder engagement, sustainability strategy and communications team. May, who previously ran the Marine Stewardship Council and is a former board member at the Rainforest Alliance, another former APP partner, is a close ally of Greenpeace, and has been a vocal critic of APP practices. To build a global network to validate and communicate APP’s performance, May brought in Tachi Kiuchi and Bill Shireman of Future 500 for the U.S. and Japan, as well as sustainability leaders in France and Australia.

Under the agreement, APP announced it would completely halt clearing primary forests beginning February 1, 2013. This would complete a transition they have been pursuing for several years, since campaigns against them began.

“There is a long history of commitments which have not been kept, and that leads to suspicion,” Tait says. But he is “positive and cautiously optimistic” that after past failures, this commitment will last. What gives him cautious optimism is APP’s commitment to an immediate moratorium on harvesting in primary forests. “This was the first clear indication that APP is serious.”

Next, Greenpeace, TFT and APP are collaborating to sort out the “complicated” process of how, in addition to forest sustainability, APP can satisfy social commitments to local communities, and protect high carbon value (HCV) peatlands.

Greenpeace will take a “wait and see” approach, monitoring progress on the ground and relying on “evidence of delivery” before they conclude whether the commitment is real. “Evidence of delivery will take some time, and must come before a resumption of purchases.”

Greenpeace will examine the evidence in approximately three-month intervals. They, along with RAN and WWF, will continue to engage the company and its customers actively, and will be watching to see if this breakthrough commitment yields on-the-ground change that they can call transformative.

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