Position
Paper, July 30 1999
B&Q;
Timber Target Update
This
paper summarises the success towards achieving our target to only
buy timber products and wallpaper which have come from well managed
forests and have been certified under the Forest Stewardship Council
scheme. Our target date for this is December 31st 1999. We are on
track to achieve of 80% of our products under the FSC scheme. We
now find ourselves ready to review how the certification debate
and our policy needs to evolve to remain relevant to our customers.
We will also outline our responses to recent developments that we
must address in order to create clarity and maintain the momentum
towards the successful delivery of our objectives.
Summary
of Achievements to date
From
a total of 14,700 products;
Products
currently certified under FSC 1,398 (9.5%)
Products
"on track" to be certified under the FSC scheme by Dec 31st 1999
8,195 (56%). (By "on track we mean products which are not yet certified
but we are satisfied there is sufficient momentum to ensure that
certification will be completed this year. We have included in this
category all of our UK sources).
Products
which we are confident can be obtained from certified sources within
the deadline although more activity is required to make sure this
is achieved 2,011 (14%)
This
means we are likely to achieve our FSC target for 79% of our product
lines.
Of
the remainder 2,876 (19.5%) products come from Finland (see section
on Finland).
220
(1%) are products that we recognise will be very difficult to achieve
certification and these will be discontinued or replaced. That means
that certification of forest sources and tracing that timber from
forest to store for our entire range is not only possible but has
virtually been achieved.
It
is now time to review our success, understand the reasons behind
that success but also understand the underlying reasons for the
problem areas. It is essential that our policies and action plans
are relevant for the future rather than the past. This review has
already started and already we are discovering implications for
both the long term and short term.
Firstly
B&Q has grown. We have ambitious opening plans for Warehouse stores
of which the largest growth area is timber and joinery. We now have
a significant trade business and we are introducing with great success
new timber products to both DIY and trade customers. Flooring and
outside decking are just two examples of timber products which has
grown to multi-million pound businesses in only three years. We
continue to buy from around the world and we have exciting potential
buying synergy opportunities across the Kingfisher group. Through
new store opening, mergers and acquisitions we now have stores in
China, Taiwan, Poland and through our French partner, Castorama,
stores throughout Europe plus Canada and Brazil.
Our
review has already acknowledged that our vision and strategy has
been more or less correct. Suppliers respect the leadership we took
and while our staff are proud of our achievements. We have discovered
new, exciting sources of product and we understand our supply chain
far better than we did before. Forest owners and the market are
talking to each other and understand each others needs better. This
has to be healthy for all the businesses involved.
There
are, however, two significantly difficult issues that both highlight
a need for a revision in our current thinking
1)
How to respond to the confusion over certifying products with a
high recycled content (such as some of our wallpaper, chipboards
and MDF).
2)
What will our response be to the other schemes in development, in
particular Finland?
Recycled
Content
This
poses a real philosophical challenge for the FSC. Should FSC certify
a product that is 100% recycled? This would mean FSC has to move
away from its original mandate of focusing on purely forests and
enter the new arena of certifying recycled content. FSC is currently
reluctant to go down that route.
The
vast majority of B&Q timber products are chipboard and wallpapers
and most of these will have a recycled content. This presents FSC
with another philosophical problem; what recycled content to allow
before the virgin proportion is so small that its becomes inappropriate
to certify the product. Currently, this is set at 17.5% (70% of
the minimum 25% virgin fibre) or higher.
For
B&Q this is a critical issue since some of our chipboard, MDF and
wallcovering products either currently or potentially will exceed
that limit. Some products already are made from 100% recycled materials.
We predict an increase in waste timber and paper recycling so the
proportion of recycled products will increase overtime.
FSC
has recognised that the existing rules for percentage labelling
are unworkable and have agreed to revise them. We welcome this.
We
are however, concerned that the proposed solution to increase the
allowable recycled content will add to the ambiguity and not address
the fundamental philosophical question this issue raises. If FSC
is reluctant to certify the recycled content, is it logical to increase
the allowable percentage of recycled material in the products they
certify? If they recognise the need to certify a product with a
high recycled content why not expand the scheme to formally certify
any recycled content and avoid the setting of arbitrary limits which
bears no relation to the product or manufacturing process? This
will mean certifying a product that is 100% recycled.
We
respect FSCs preference to focus purely on forests but that focus
does not help the people certification intends to serve - our customers.
Our customers buy products and not forests. Whilst convenient for
FSC, it is confusing for our customers.
There
is another problem with not certifying products with a high recycled
content. It ignores the key reason why B&Q and other companies supported
the FSC to the exclusion of other schemes. B&Q support the FSC because
it had the potential to allow us to have one label on all our wooden
and paper products regardless of the certification scheme and country
of origin. Therefore any scheme which does not certify a product
which is 100% recycled will deny us this vision.
Our
proposal is that FSC could certify a truth statement that outlines
the proportion of a product coming from well-managed forests or
a recycled source.
B&Q
Policy Decision;
Products
with a recycled content, which is too high to comply with FSC, are
exempt from our FSC requirement. Instead we will require a recycled
content statement such as:
"This
product is made from 97% post-consumer recycled wood".
We
will explore ways of ensuring that such statements are ratified
by a third party certifier who would issue a Chain of Custody document
in a similar format to that of the FSC process. This decision has
a significant influence over how we approach the other issues we
are faced with.
We
have come to the conclusion that there is a gulf between forest
certification and product certification and perhaps the real answer
lies in completely separating the two. We shall discuss this later.
Other
Schemes
The
past year has seen the appearance of other schemes. Some schemes
such as the Indonesian LEI scheme are pro-actively seeking some
form of mutual recognition with FSC but for some schemes this seems
unlikely (e.g. Pan European). Indeed there are many stakeholders
who have persistently expressed the desire to have more than one
scheme so as to create a competitive atmosphere within the certification
arena. B&Q has resisted other schemes in pursuit of our vision for
a single label on all products.
However,
such a stance becomes challenged if you consider our true objective
96 good forest management. If the other schemes have the potential
to deliver good forest management, should B&Q continue to ignore
them? Furthermore, since FSC existing and proposed policy on recycled
content forces B&Q to place a recycled statement on products with
a high recycled content, the opportunity to have a single label
on all our products is now impossible.
Finland
is a very significant source for us. Whilst reviewing the historical
context of our policy we must not forget that other than one isolated
example, B&Q has never been criticised for buying timber from Finland.
We have also been encouraged by the determination of the Finnish
industry to create a scheme that meets our needs.
There
is, however, political tension between the environmental groups
and the small woodland owners. This means FSC recognition of the
Finnish scheme is unlikely. We believe that it would be unfair to
cause further anxiety to our direct suppliers by forcing a restructuring
of their supply chain because of a political problem that is not
of their making. However, we will continue to list separately the
products which are certified under the FSC scheme and those which
are certified under the Finnish scheme so as to avoid giving the
impression that we are fudging the achievement of our original FSC
target.
At
this stage the only other scheme we are prepared to accept is the
Finnish scheme. We are currently reviewing the Indonesian and Norwegian
scheme and a review of all the other schemes should be completed
by January 31st 2000.
Policy
implication:
We
have decided to accept the Finnish scheme.
We
know that the lack of FSC recognition of the Finnish scheme is not
in the best interests of the Finnish timber industry or the Finnish
small woodland owners since we will continue to choose FSC in preference
to other certified products. In addition the Finnish industry will
be excluded from much of the publicity and promotion of timber and
FSC products. Without FSC we predict a reduction in our purchases
from Finland and where alternatives do exist we will strongly encourage
that change.
Therefore,
we will require the following statement to be printed on the package;
"The
wood/pulp in this product has been independently certified in accordance
with the rules of the Finnish Forestry Certification Scheme. (plus
recycled content of 85)"
We
recognise this has the potential to force us to accept other national
schemes. If the forest management integrity is preserved, the sources
are historically uncontroversial and there is an atmosphere of goodwill
between industry, small forest owners and the environmental community
then we are prepared, in the short term, to accept that scheme.
However, all these schemes must have a clearly stated vision to
seek accreditation or recognition by a global umbrella scheme. It
is in those schemes best interest to avoid the commercially damaging
scenario of competing national schemes having lower standards and
less integrity while the resulting proliferation of labels in our
stores will cause customer confusion.
Since
the Pan-European scheme appears to be an accreditation scheme for
only European national initiatives we do not see how this scheme
adds any value to either the national schemes or our strategy when
it cannot accredit schemes outside Europe where we have both stores
and forest sources. We do not see how the Pan European scheme will
ever be a viable alternative to the potential value FSC can add,
and has been adding, to our products. We hope that FSC will continue
to explore ways of recognising national schemes and we see this
as the way forward.
Policy
Implications
B&Q
will accept the principle that good forest management can be guaranteed
to our customers by national schemes which are accredited by a global
umbrella scheme (of which the FSC approach is currently the best
model).
Over
the next six months we will examine all the other schemes and measure
their potential to meet our needs. These criteria will include:
a..
Client/customer focus
b..
Philosophy based on product certification
c..
End product focus, with good chain of custody and customer friendly
approach to the recycled content.
d..
Good forestry principles and standards (FSC principle being the
likely bench mark)
e..
Potential for a single label, or fit into a single labelling scheme
f..
Clear leadership with a quick decision making process
g..
Credibility with NGOs., industry and other stakeholders
h..
Visibility of costs
i..
Willingness to work in collaboration with other schemes
j..
Close working relationship with retailers
For
us the ideal model is illustrated below. In this model we have national
schemes operating throughout the world. These are all recognised
by a globally operating umbrella scheme. It is that scheme which
awards the single label. The umbrella will be sufficiently flexible
to accredit commercial and "not for profit" schemes which can operate
in countries where there is no national scheme.
It
is the umbrella scheme that focuses on the certification of the
final products and to avoid confusion for our customers it is that
scheme which also ensures that the "chain of custody" is in place
and has the task of certifying the recycled content of a product.
That service will also include the verification of manufacturers
claims of products that are made of 100% recycled waste. The national
schemes will focus purely on the certification of forests.
Currently
there is no such umbrella scheme in place to meet these future needs
and to get there will involve some major reviews of present thinking
with potential paradigm shifts from all the major players. FSC is
close and it would be irrational if we need to completely start
again when FSC has the potential to meet these needs.
Conclusion
Over
the past nine years we have completely restructured our supply base.
From not knowing which countries our timber came from, we are now
in position to state the forest region, give reassurances that the
source is well managed and have the confidence that those reassurances
have the support from the environmental community. We have achieved
as much as we can and ironically we are grateful for the challenges
the recycling issue and Finland have given us. It was those two
problems in particular that has challenged our thinking.
Our
success has been an enormous achievement given the resistance there
was from both the industry and majority of the NGOs, back in the
early 1990s. We are and remain grateful for all suppliers who have
made these achievements possible.
We
remain loyal to our vision of one product label and it is only circumstances
outside our control that has made this impossible, in the short
term, to reach. With 80% of our products certified, or close to
being certified under the FSC scheme we know the single label vision
is possible but that will involve a change in many peoples thinking.
Our review of all current and future schemes will identify the potential
for that vision to be met. However, with B&Q now operating stores
in Taiwan and China and a supply base that extends around the world,
any scheme that operates in isolation at a national or even continental
level will be disadvantaged against any scheme operating at a global
level. Likewise any scheme which focuses on forest certification
will be at a disadvantage against any scheme whose focus is on the
consumer product (which may or may not be made from recycled wood
or paper waste).
Certification
has often been described as a bridge between the forest and the
customer. It is important that the politics of this debate does
not distract us from who the bridge intends to serve. If there is
a gap in the bridge, it is not a bridge.
B&Q
will continue to help the "engineers" of this debate span those
gaps but that will be only achieved with all the players being less
political, more pragmatic and more customer focused.
Basically
anybody involved in this debate must always think both "global",
and think "customer".
For
further details please contact:
Alan
P. Knight, B&Q, email: alan.knight(@)b-and-q.co.uk
John
Frost, B&Q
July
30 1999
B&Q
plc. Portwood House, 1 Hampshire Corporate Park, Chandlers Ford,
Eastleigh, Hants. So53 3YX, UK
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