Businesses turn towards conservation to improve revenues, reputations

Some unlikely businesses have emerged to lead the way on conservation, and the trend appears to be catching on, noted former US vice president and environmental campaigner Al Gore at a business dialogue in Jakarta on Sunday.

Timber, palm oil and pulp and paper companies, for instance, have committed to conserving vast tracts of land in Indonesia’s forests. Other firms are partnering with non-governmental organizations, such as the World Wildlife Fund, which recently launched the Heart of Borneo Green Business Network (GBN), a campaign aiming to transmit information to businesses about carbon financing and new government regulations.

Through the Green Business Network, the WWF hopes to move businesses toward more sustainable practices, including increasing productivity and ensuring any expansion is only on degraded land. Corporate social responsibility (CSR) commitments have also led companies, such as Nokia, to invest in reforestation projects. Others have set aside nature reserves or invested in habitat protection for endangered species, such as tigers and orangutans.

But more businesses are seeing a practical side to conservation.

Beyond being just a good practice, sustainable development also helps improve company revenues and reputations, Gore explained. In the long run, deforestation costs more than the timber that is sold. Indonesia has a lot to lose if the climate crisis is not solved, added Gore, referring to the country’s heavy reliance on its forests for jobs and economic growth.

Asia Pulp and Paper (APP) is one firm that is hoping its efforts will go some way toward improving its image. The Sinar Mas subsidiary, which has come under pressure from conservationists who accuse it of large-scale deforestation, recently signed a deal with Singapore-based Carbon Conservation to set aside a large area of peat-rich forest in Sumatra in return for carbon offset revenue, the money earned when a polluting industry buys carbon credits from one conserving them.

Forest campaigners say APP’s effort at protection is too small to offset the damage the company continues to inflict on the rainforests. But Aida Greenbury, who manages APP’s sustainability programs, said the company has already put aside around 40 per cent of its 2.5 million hectare concession for conservation, community development and species protection.

Making money off the trees

Like APP, many companies are weighing the revenue potential of carbon credits. Dozens are currently applying for certification under the Voluntary Carbon Standard, which ensures that forest carbon projects have real environmental benefits and the voluntary credits they seek to sell are credible for investors.

One of Indonesia’s leading palm oil companies, Austindo Nusantara Jaya, has joined with Fauna and Flora International to develop a REDD project in a palm oil estate in Gunung Palung National Park, in West Kalimantan. REDD is a scheme aimed at reducing emissions from deforestation and degradation by getting developed countries to pay developing ones not to cut down their forests.

Environmental consulting businesses are helping them along. Forest Carbon, an Indonesia-based forestry consulting firm, has partnered with Credent Technology and The Nature Conservancy to use high-tech imaging equipment to map forest carbon stocks on the island. The technology would make it faster and easier to assess carbon stocks in large forested areas, reducing costs for businesses wanting to invest in REDD-based projects.

The benefits to be made from carbon trading are still uncertain, however, since no formal market currently exists for the buying and selling of credits. Meanwhile, companies focused on forest conservation face unclear regulations on land use and a stalled forest-clearing moratorium in Indonesia that they say makes it difficult to know what areas are most in need of protection.

Asia Pacific Resources International (APRIL), another major pulp and paper producer, has devoted 27 per cent of its concession to conservation. But APRIL’s sustainability manager Brad Sanders says local governments often complicate conservation measures by handing out their own land use permits, which countervail their efforts.

Another concern is the wording of the Indonesia-Norway partnership that is part of Indonesia’s REDD efforts. Sanders says it seems to favour continued development, and other conservationists say the partnership will require a high level of oversight to ensure the money is not misappropriated.

Bribery, misuse and land-right disputes with local communities, which often stand to lose the most when conservation efforts fail, are some of the issues businesses will have to worry about this year, also the International Year of the Forests.

Concluding his speech on Sunday at a dialogue organised by Business for the Environment (B4E), Gore commended Asian countries for their growing efforts to green their policies and economy. His nod went mostly to China, which has invested heavily in solar and wind power.

But while China is leading the world, he said, Indonesia too should take its place as a leader in the green movement.

Read more about Al Gore’s message for Indonesia.

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