Mongabay Series: Evolving Conservation

Market-based conservation programs slow deforestation in Chile, study finds

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Together, two eco-certification programs and one clear-cutting moratorium reduced deforestation by up to 23 percent on participating plots. The most effective program, run by the Forest Stewardship Council, also entailed the greatest collaboration between industry and conservation groups.

Market-based conservation programs slow deforestation in Chile, study finds
  • In recent years, eco-certification, moratoria, and other so-called non-state, market-driven governance regimes have become a common approach to reducing deforestation.
  • However, data on the effectiveness of these programs has been limited.
  • A new study analyzing three such programs in Chile finds that the more collaboration between industry and environmental groups a program entails, the more successful it may be.

A new study of market-based forest conservation schemes in Chile provides rare insight into the effectiveness of this relatively new approach to preventing deforestation.

The schemes, known as non-state, market-driven (NSMD) governance regimes reduced deforestation on participating properties by between 2 and 23 percent, conclude the study’s authors, Robert Heilmayr, who recently completed his doctorate at Stanford University, and Eric Lambin, an earth scientist there. The study will be published this week in Proceedings of the National Academy of Sciences.

Together, the schemes, active starting in the early 2000s, conserved nearly 4,000 hectares of natural forest —about 15 square miles. That represents a marginal success, considering that the programs intended to halt deforestation completely, but a notable improvement over business as usual, according to Heilmayr.

A temperate rainforest near Parque Pumalín in south central Chile. Photo by Robert Heilmayr.
A temperate rainforest near Parque Pumalín in south central Chile. Photo by Robert Heilmayr.

Heilmayr and Lambin set out to investigate whether, in response to growing global demand for forestry products, NSMD conservation schemes “improve[d] the environmental and social impacts of commodity production,” as they aim to do.

They also looked at how effective Chile’s three biggest programs were: an industry-driven eco-certification scheme called CERTFOR, a multi-stakeholder eco-certification scheme through the Forest Stewardship Council, and a moratorium on clear-cutting agreed to by certain logging companies and NGOs called the Joint Solutions Project. The Forest Stewardship Council program, the most collaborative of the three, performed the best.

NSMD programs are a relatively new approach to conservation, Heilmayr explained in an interview with Mongabay. In forest conservation, they represent an innovative way to harness the power of markets as an alternative to the more traditional approach of using government policies or legal restrictions to set forestry practices or create areas off limits to logging. NSMD programs cut out the government entirely; they generally work directly between NGOs, consumers, and producers.

They can be found in many global commodities. For example, Fair Trade coffee and organic produce certification programs are NSMD programs. And they take many forms, including voluntary agreements struck between producers and environmental organizations, moratoria on certain commodities or practices, and certification schemes that identify products as having been produced in accordance with ecological or ethical criteria.

A high-elevation forest in Chile’s Cochamo valley. Photo by Robert Heilmayr.
A high-elevation forest in Chile’s Cochamo valley. Photo by Robert Heilmayr.

The different types of programs have two things in common, according to Heilmayr. “First, they’re implemented by non-state actors… Second, they’re market-driven. They’re trying to harness markets — whether it’s price premiums or access to certain markets — to incentivize action by producers to improve their environmental performance,” he said.

However, data on these programs, most of which are not older than a decade or so, is scarce, and scientific studies of their effectiveness are hard to come by.

Converting Chilean forests to tree farms

On Chile’s rugged Pacific coastline roughly a thousand miles up from the southern tip of the continent stands a forest of prehistoric beauty. Home to the country’s largest population of endangered flora and fauna and a biodiversity hotspot, the Valdivian forest, South America’s only temperate rainforest, is sandwiched between the crashing waves of the ocean and the soaring heights of the southern Andes.

A single, old-growth alerce tree left standing in a clearing. The species (Fitzroya cupressoides) grows more than 150 feet tall. The oldest one on record was 3,622 years old. Photo by Robert Heilmayr.
A single old-growth alerce tree left standing in a clearing. The species (Fitzroya cupressoides) grows more than 150 feet tall. The oldest one on record was 3,622 years old. Photo by Robert Heilmayr.

When the H.M.S. Beagle landed here during Charles Darwin’s famous voyage, vast stands of dignified conifers commanded the coast; they would later take the name of the Beagle’s captain, Robert Fitzroy. The alerce (Fitzroya cupressoides), a species of cypress, grows more than 150 feet tall and lives for thousands of years. (Indeed, one specimen holds the record as the fourth oldest living tree ever discovered — in 1993 it was 3,622 years old.)

Chile was the first country in the southern hemisphere to really emerge as a global force in the timber industry in the second half of the twentieth century. Until then the industry had been dominated by northern countries with huge expanses of boreal forest: the U.S., Canada, Russia. The Valdivian’s natural bounty made it a main target for logging companies.

Of the roughly 54,000 square miles of Valdivian forest that existed when Europeans arrived, less than half remains, according to the World Wildlife Fund (WWF). Logging and clear-cutting accelerated in the second half of the twentieth century. Chile had become a major producer of wheat and large swathes of forestland had been cleared for agriculture. In 1974, the regime of Augusto Pinochet, ostensibly hoping to slow the aggressive erosion that had resulted from shortsighted agricultural practices, enacted land-use reforms that subsidized forestry plantations.

But the reforms had an unintentionally disastrous effect on Chile’s natural forests. Loggers cleared them of cypress and evergreens and replaced them with plantations of nonnative pine and eucalyptus. Between 1975 and 2007, timber plantations increased roughly ten-fold across the country and came to account for almost half of the south-central Chilean landscape.

An abandoned mobile, steam-powered sawmill in the forests of central Chile. Photo by Robert Heilmayr.
An abandoned mobile, steam-powered sawmill in the forests of central Chile. Photo by Robert Heilmayr.

In the early 2000s, however, retailers and consumers started to demand more sustainable forestry products, forcing major Chilean logging companies to respond. At first there was CERTFOR, an industry-backed certification scheme that environmental advocates viewed as lax.

Some smaller corporations got certified instead by the Forest Stewardship Council (FSC), which had more stringent requirements. The FSC, widely considered one of the best forest management programs in the world, is a voluntary, market-driven scheme that is supported by many environmental NGOs, including WWF, Greenpeace, and the Sierra Club.

By 2002 the pressure on Chilean forestry companies had mounted. The environmental NGO ForestEthics put advertisements in the New York Times that exhorted customers and retailers to pay attention to where their lumber and paper products were coming from. The ad featured a photo of a house amid a graveyard of stumps and fallen trunks. Underneath, it noted the beauty of “Chile’s magical siempre verde (forever green) forests” — and the danger they faced. “Many of these forests are being destroyed and replaced with legions of non-native plantation trees to produce cheap wood products for American homes. The forever green forest may soon be forever gone.”

The campaign worked. “The Chilean timber industry got really terrified of what the ramifications might be for them,” Heilmayr said. “And it shifted the conversation.”

Feeling the pressure, retail giant Home Depot brought a few of the major Chilean timber producers together with environmental NGOs at its headquarters in Atlanta. The discussions culminated in what was called the Joint Solutions Project (JSP) in 2003. The logging companies agreed not to clear-cut natural forest for plantations on their properties.

“For a lot of these NGOs and the corporations it was the first time they were all sitting around the same table, and they were actually able to hammer out a pretty clear and strong commitment,” Heilmayr said.

Analyzing the commitments

Fast forward a decade and Heilmayr and Lambin analyzed satellite images of forest properties from 1986, 2001 (roughly when companies began adopting NSMD programs), and 2011 to see how much forest area had been converted to plantations and how much had been preserved under the programs. They aimed to determine if the three programs — CERTFOR, FSC, and JSP — reduced deforestation and which of them was best at it.

“All of the programs, if you look at them pooled together, reduced deforestation by about 14 percent,” Heilmayr said.

Two generations of plantations and a natural temperate forest in central Chile. Photo by Robert Heilmayr.
Two generations of plantations and a natural temperate forest in central Chile. Photo by Robert Heilmayr.

FSC was the most effective, with forest plots participating in it alone having reduced deforestation by 43 percent, on average. Plots participating in JSP alone had average reductions of 20 percent. CERTFOR, the industry-led program with minimal oversight from NGOs, was the least effective, with plots participating in it alone having reduced deforestation by 16 percent, on average. (Plots enrolled in more than one program tended to perform poorly and brought the pooled average down, Heilmayr explained.)

Yet all three programs were meant to end deforestation, not just reduce it, and by that measure all three fell far short of their goal. “In this context,” the study notes, “anything short of 100 percent reductions in deforestation within NSMD properties could be interpreted as non-compliance with the governance regimes.”

However, the study continues, “since our treatment time period included several years before the implementation of the NSMD governance regimes, our analysis would tend to underestimate compliance. In addition, given the voluntary nature of the governance regimes, any significant reductions in forest conversion could be viewed as a policy success.”

Furthermore, Heilmayr said that all three programs were especially effective at reducing deforestation in “high-risk areas,” which he and Lambin defined as being close to a city, having good soil and a low grade, and belonging to a company that historically participated in deforestation. (However, they did not include these results in their paper.)

A recently planted pine plantation on Chiloe Island off the south central Chilean coast. Photo by Robert Heilmayr.
A recently planted pine plantation on Chiloe Island off the south central Chilean coast. Photo by Robert Heilmayr.

Lowering the deforestation rate in those high-risk areas was a major achievement, Heilmayr said. Governments often site national parks in remote locations that are unsuitable for timber production, which reduces opposition to the parks, he added. But with the NSMD schemes, he said, “since it’s a voluntary agreement that the companies are coming to the table to make, you can actually better target properties that would theoretically be really hard to conserve through government intervention.”

The study also noted that in addition to being the most successful, FSC was the most collaborative of the three NSMD programs in including a range of stakeholders in negotiations over the program’s final criteria. CERTFOR was both the least effective and least collaborative. “Our results indicate that governance regimes with greater collaboration between environmental and industry stakeholders achieved better environmental outcomes,” the study concludes.

Another bright spot: reducing deforestation for the establishment of plantation forests was also a win for biodiversity. For Heilmayr’s unpublished dissertation, he and several colleagues found that biodiversity was between 20 and 60 percent lower in plantation forests than in natural forests.

Scaling globally

NSMD programs, enacted thoughtfully, can help reduce deforestation on a wide scale, Heilmayr and Lambin’s study concludes. FSC, for example, is a global program.

But one of FSC’s drawbacks is the myriad of regulatory and certification frameworks it employs. It depends on the country, said Wayne Winegarden, an economist who studies environmental markets at the Pacific Research Institute, a free-market think tank in San Francisco. Though FSC has basic standards that all countries must adhere to, its programs in Russia or Indonesia, for example, are very different from the one it has in the U.S.

An alerce sapling grows in a clearing. Photo by Robert Heilmayr.
An alerce sapling grows in a clearing. Photo by Robert Heilmayr.

In one sense this is necessary and appropriate, Winegarden said. Managing a forest in one place can be quite different from managing a forest elsewhere, he said. But FSC’s different certification standards can be frustrating for conscious consumers and analysts. “We don’t have consistency,” Winegarden said. “You could have a forest in Russia that isn’t maintained at anything close to the standards of what we would consider a well-maintained forest here in the U.S.”

In a general sense, NSMD programs lack the authority found in government-led conservation, as many observers have noted. In the end, Heilmayr said, government-led conservation initiatives like national parks can reduce deforestation to zero. “We didn’t find that” with the NSMD programs, he said.

But, he went on, “you can imagine that a ‘both’ approach could have the best conservation outcomes, where you have a strong regulatory approach to pristine conservation but you also engage with corporations to try to improve environmental practices on the mosaic of holdings that they have.”

Citations

  • Heilmayr, R. and Lambin, E. (2016). Impacts of non-state, market-driven governance on Chilean forests. Proceedings of the National Academy of Sciences.

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