If there is one, central theme that runs consistently through the my commentary in this space, it is this: our “green” certification programs for paper and wood products (FSC, PEFC, & SFI) are too complicated. This is especially true for the Chain of Custody (CoC) standards. It might be argued that effective and credible standards for something as challenging as the sustainable forest management (SFM) will always be complex. But CoC (described here by FSC and PEFC) is meant to function after the hard work of SFM certification is all done. It exists only to provide a verified link between the product on the shelf – the one with the pretty green label – and the source of its raw materials. It should be a matter of transparency and traceability – simple right?
The unfortunate truth is that, in practice, certified Chain of Custody (CoC) is far from simple. It has become a subject of endless frustration, effort, and expense for everyone in the supply chain; from loggers in the woods, to sawmills, papermakers, printers, and woodworkers. This has been true for years, but it doesn’t have to be that way.
Chain of Custody (CoC) Basics
Any good Chain of Custody business system should be designed around three basic concepts:
- Inputs – practices and procedures that identify and recognize the certification status of raw materials, including the communication with suppliers and verifications done when materials or products are received and accepted for use.
- Controls – internal practices and procedures that a business needs to track and maintain the certification status of materials and products while a business has custody of them.
- Outputs – practices and procedures that identify the certified status of products offered for sale to customers.
Any company that implements an effective business system containing these three elements can, in my view, be said to have achieved a practical chain of custody. Unfortunately, for most of us, practical chain of custody is not sufficient to meet our business needs. We need certified chain of custody. That means a) implementing a system that conforms to the specific requirements of one or more of the FSC, PEFC, or SFI standards, and b) subjecting that system to the third-party certification process. A well-conceived system will, however, still conform closely to my three basic concepts. – with just enough added detail to pass the certification process.
Certified Chain of Custody (CoC)
The PEFC, SFI, and FSC CoC standards are famous for being confusing, multi-layered, and error-prone. But their content can be understood and managed by breaking them down into three basic subject areas:
- Inputs, Outputs, & Labels: This accounts for 3/4 of the actual effort and expense of “real world” chain of custody. It includes 2 of the 3 practical concepts discussed above, but is specifically defined (for most companies) by only a small number of actual standard requirements. Get this subject right, and everything else is easy.
- Management System Requirements: This includes a large number of specific standard elements – including written procedures, record keeping, policies, and training. They vary considerably in application among different kinds of businesses, but should account for a small proportion of actual effort and expense.
- Processing and Accounting Rules: This is where most of the actual complexity lies, and includes the parts of the standard that are least understood and most often mis-applied. Despite all that, relatively little effort and energy is expended here. Most companies simply need to identify the best fit from among the options offered by the standards, and match it to their business needs. This makes it an interesting area of opportunity.
Making It Easier
This post is the first installment in a series of articles on this subject. The next one (hopefully out next week) will be entitled “CoC SHOULD BE EASY! – Part 1: Inputs, Outputs, & Labels” We will explore each of the key subject areas I have noted here. We will also branch out into a few other important side topics like Due Diligence, Controlled Wood, and the dreaded SFI Certified Sourcing. I will compare and contrast the differing approaches among the standards, and point to some innovative solutions and approaches to common challenges. Throughout the series, our key focus will be on demonstrating that this stuff doesn’t have to be complicated. Because, after all, CoC SHOULD BE EASY! Right?
UPDATE: 15 April 2014: Click Here for CoC SHOULD BE EASY! – Part 1: Inputs, Outputs, & Labels
UPDATE: 2 May 2014: Click Here for CoC SHOULD BE EASY! – Part 2: Management Systems
UPDATE: 6 May 2014: Click Here for CoC SHOULD BE EASY! – Part 3: Processing and Accounting Rules
UPDATE: 4 June 2014: Click Here for CoC SHOULD BE EASY! – Part 4: Due Diligence Systems (DDS)