Seven pillars of FLEGT
This section explains the EU FLEGT Action Plan’s seven broad elements, which are listed below. It describes progress and provides case studies and reporting tips. Among the topics covered are the EU Timber Regulation and Voluntary Partnership Agreements between the EU and timber exporting countries outside the EU.
Investment and finance
Large scale investment in land, mining, commodities and infrastructure in timber-producing countries has without question encouraged illegal logging.
FLEGT encourages investors, including export credit agencies, banks and financial institutions to use strong due-diligence procedures to limit the social and environmental impacts of their investments in forest sector operations. Particular care should be taken before investing in areas where there is disputed land ownership, or contradictions between official and traditional land ownership rights. Such issues are a key part of Voluntary Partnership Agreement (VPA) negotiations and so investors are encouraged to be aware of progress in countries negotiating and implementing VPAs.
The launch of FLEGT and other initiatives such as the EU’s Transparency Directive, Accounting Directive and Non-Financial Disclosure Directive are encouraging European financial institutions to take environmental and social issues more seriously. However, compared to other aspects of the EU FLEGT Action Plan, there has been less action on financial and investment provisions.
You’ve heard it before but we’ll say it again: Follow the money. And follow those who make it. A 2015 study entitled “Why is it so incredibly hard to stop deforestation” found that despite diverse legal systems and varying levels of decentralisation in five countries, powerful actors with a stake in deforestation often figure out how to get their way – whether using the rules to their advantage, or going around them.
Go to the bank. Ask banks and investors what they are doing to ensure they don’t contribute to illegal logging. Few will have comprehensive answers, and for those that don’t this will open doors to new stories. Find out where the investments are – do they intersect with a country’s forest sector in some way? Follow the money right down to the ground, then contact companies and civil society groups to get their perspectives. You might draw a blank, but you might reveal a chain of cash that connects mainstream financial institutions with forest crimes.
Timber tracking in the Democratic Republic of the Congo
Credit: EU FLEGT Facility