World Rainforest Movement

Forestry projects: certification

In 1998, the World Bank and WWF announced a new ‘Forest Alliance’ with the target of securing 200 million hectares of certified forests in World Bank client countries by 2005. The Alliance has faced a serious challenge in reaching this goal. As most logging operations are in fact carried out by private logging companies, the main part of the World Bank lacks leverage to persuade companies to upgrade their logging to certification standards, but the IFC, which does invest in the private sector, has yet to change its policy in line with the rest of the World Bank and is anyway not part of the Alliance. The Alliance admits that, to date, only some 22 million hectares of forests have been certified to credible standards in Bank client countries but the contribution of World Bank-WWF projects to securing this total is far from clear.

For the Bank to fund a forestry project, the new policy does require either that the project has been certified under a credible certification scheme (article 9a) or has a plan to get certified (9b). According to the Forests Policy, the certification should require: compliance with the law; recognition and respect for legally documented or customary land tenure and use rights as well as the rights of indigenous peoples and workers; measures to maintain or enhance sound and effective community relations and multiple benefits; conservation of biodiversity and ecological functions; monitoring and evaluation. In addition, certification must be fair, transparent, independent, based on third party assessment, cost-effective, based on objective and measurable performance standards defined at the national level, compatible with internationally accepted principles and criteria of sustainable forest management (SFM), developed with meaningful participation of local people and communities and other members of civil society, and designed to avoid conflicts of interest. The only scheme which comes anywhere near to meeting these criteria is the Forest Stewardship Council but the World Bank-WWF Alliance overlooked many of the problems of FSC certification process. An analysis of the Bank’s 11 ‘criteria’ for a ‘credible’ certification scheme showed that the FSC probably failed on at least 7 of them.

However, where the World Bank has made major interventions in the forestry sector, as in the Democratic Republic of the Congo (see article “Democratic Republic of Congo –after the war, the fight for the forest” in this issue), there is no evidence that these criteria have been applied. The vigilance of the World Bank-WWF Alliance in tracking these developments is also open to question.

Under Article 9b the Bank may fund a project in a forest that has not yet meet the requirements of certification subject to a “time-bound phased action plan acceptable to the Bank for achieving certification”.

In addition, in its new Forests Strategy, the Bank claimed that it had:

“agreed with leading international conservation agencies that it will encourage the widespread use of internationally agreed criteria and indicators for sustainable forest management. These criteria include those defined by the ITTC, discussed in the IPF [and] IFF, and embodied in the principles and criteria of bodies such as the Forest Stewardship Council” .

There are other fundamental problems with this element of the Bank’s Forest Policy:

– Neither the Strategy nor the Policy are at all clear on what happens in the eventuality that companies without certification at the time of receiving Bank loans or grants fail to comply with their ‘action plan’ for achieving certification. Would the Bank request re-payment of any loan or grants?

– The Strategy and Policy fail to address the obvious paradox that, under ‘credible’ certification systems such as the FSC, an important criterion for certification is that the forestry operation is ‘economically sustainable’. If certified operations are already economically sustainable, it is not clear what would be the purpose or value of providing them with World Bank funding.

In practice, like so many other elements of the Forests ‘Strategy’ and commitments set out by the Bank in 2002, the certification requirements have not been implemented. The authors of this report are not aware of any single case where the IBRD/IDA has actually required certification in association with a forest sector loan or grant, although some funds have been provided to develop national certification standards, notably in Eastern Europe.

In the Forests Strategy, the Bank suggested that an expert in certification should be included in any Advisory Panel that would be required under all ‘Environmental Category A’ forestry projects. However, as noted elsewhere in this report, the Bank has substantially weakened the panel, and has avoided the requirement for certification, either by downgrading controversial forestry projects to ‘Environmental Category B’, or by including forest sector interventions within Structural Adjustment Credits which are not subject to the Forests Policy.

By Forest Peoples Programme, e-mail: ,, and The Rainforest Foundation-UK, e-mail:,