Tag Archives: Economically Viable

FSC Standard – Economically Viable

I just thought I’d rave a bit more about the ridiculous FSC Standard for Economically Viable.

Clearly the FSC is completely confused and conflicted about whether forestry is welfare or commerce, or is it money laundering?

So far I have found two different definitions of what the FSC means by Economically Viable. The first example comes from FSC UK:

Economically Viable

Economically viable forest management means that forest operations are structured and managed so as to be sufficiently profitable, without generating financial profit at the expense of the forest resource, the ecosystem, or affected communities. The tension between the need to generate adequate financial returns and the principles of responsible forest operations can be reduced through efforts to market the full range of forest products and services for their best value.

https://www.fsc-uk.org/en-uk/about-fsc/what-is-fsc/our-mission-and-vision

The second example comes from FSC Australia:

Economically Viable

The FSC certification standard requires that a forest management entity have sufficient financial resources to manage the defined forest area in conformance with the full scope of the standard.  The standard does not require that the certified forest is managed at a profit provided that other sources of working capital are available and sufficient to enable management in conformance with the standard.

https://www.scsglobalservices.com/news/scs-responds-to-questions-about-the-forestry-tasmania-fsc-forest-management-assessment

Both these examples demonstrate that no one at the FSC has ever studied Economics 101 – basic economic theory and principles.

So let’s discuss the FSC UK definition first:

Of the two definitions it’s the one I like the most; not perfect but at least heading in the right direction. Clearly the UK believes that forestry (growing trees for wood production) is a business, not welfare or money laundering. But the wording could be improved and simplified.

So here is my edit of the UK definition:

Economically viable forest management means that forest operations are structured and managed so as to be profitable. Any subsidies to the forest grower must be available equally to all forest growers within the same jurisdiction.

The rest of the words are pointless. If the forest management is Environmentally Appropriate, Socially Beneficial but it is not profitable then presumably the forest owner would not harvest any trees, ie. No need to seek FSC certification.

If the forest management meets all three Standards, then there is no need to reiterate the environmental and social standards within the economic standard as the UK definition has done. It is superfluous text!

Meet all three Standards = Achieve FSC Certification!

What is “sufficiently” profitable is a decision for the forest owner to make, based on available markets, etc..

If the forest owner is subsidised to manage the forest for wood production (which may be the case in some countries), then the FSC must ensure that all forest owners within that same jurisdiction have equal access to the same subsidies, ie. The FSC has a duty to uphold the principles of competitive neutrality within the forest industry, and not advantage one forest grower over another.

https://blackwoodgrowers.com.au/2016/10/17/competitive-neutrality-in-forestry/

Which leads me nicely to the Australian definition of Economically Viable.

The Australian definition of Economically Viable could be taken to be supportive of money laundering in the forest industry.

Within the Australian definition no profitability is required.

Any amount of money from any source (eg. Criminal activity) can be used to subsidise forest management, achieve economic viability and hence achieve FSC Certification.

In Tasmania that equates to robbing taxpayers to pay sawmillers.

If that definition does not open the gates to corruption and criminal activity I don’t know what would!

I would love to meet the economist that signed off on that definition of “economically viable”! A very “creative” economist indeed!!

Never mind the fact that the FSC supports both of the above contradictory Standards!!

If I was a farmer wanting to diversify my income and plant trees for wood production what would I think of the above Standards?

Would I be supportive of the FSC?

If I was a Tasmanian concerned about the continuing plunder of our public native forests, what would I think of the FSC? Would I have any confidence in Third Party Forest Certification?

I think the FSC has a long way to go to achieve any credibility.