Forest Stewardship Council certification of natural forest management in Indonesia: Required improvements, costs, incentives, and barriers

Voluntary, third-party, market-based forest certification has helped promote the transition from forest exploitation for timber to multiple-objective forest management in Indonesia. Here we describe the paths followed to Forestry Stewardship Council (FSC) certification of responsible management by five forestry concessions in Kalimantan, Indonesia. We found that while only modest improvements in forest management practices would be required for the concessions to comply with governmental regulations, much more substantial improvements were needed for FSC certification. Making these improvements was expensive mostly because the concessions lacked the required technical capacity and thus relied on support from outside institutions. We estimated that the direct costs of certification, half of which were paid by various donors, amounted to USD 300 000 to USD 700 000 per concession, with averages of USD 4.76/ha and USD 0.1/m3. Due to the minimal financial benefits the concessionaires received from certification of their forest products, external funds for the required technical inputs and audits were essential, but the business and marketing strategies of companies linked to the concessions also favoured certification. Forest certification is expanding in Indonesia for a variety of reasons, mostly related to partnerships between the private sector and civil society as well as in response to emerging synergies with the newly enacted government regulations (e.g. verification of timber legality and mandatory certification) and concerns about corporate reputations. Despite these facilitating factors, many barriers to certification remain, including unclear forest land tenure, perverse government regulations, high costs, lack of technical capacity, and scarcity of "green premiums" for certified forest products.

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