Another New Year brings the familiar tradition of reflection. A bit of looking back and a lot of looking forward. The view out our office window looks like January usually does: stark, cold, and stimulating.
Turning the calendar to begin 2022, we find ourselves facing several important changes in the business of Chain of Custody certification. Here is a collection of some things that we are following, things that we think will make 2022 an interesting year.
Three New Standards
For the first time in memory, all three of the Chain of Custody (CoC) programs that we follow are introducing important updates to their standards simultaneously. PEFC and SFI are implementing brand new versions of their standards. FSC is unveiling an update and expansion of its CoC standard and some important administrative and policy initiatives. Taken together, we have a lot of new material to digest and absorb. Let’s take a closer look.
FSC Core Labor Requirements
Readers of this blog will know that the Forest Stewardship Council incorporated a new set of social indicators into its core Chain of Custody standard last year. We have made it no secret that we think this change is ill-considered and unwise. Nonetheless, it is now a reality we need to learn to live with.
For most companies, the need to conform to the new FSC Core Labor Requirements (CLR) will be confronted in preparation for your annual audit this year. FSC staff has provided an enormous volume of guidance and support material on the subject. Some of it is very helpful, but the sheer volume is troublesome. We recommend ignoring most of the material provided by the international office and focusing instead on the national affiliates. FSC-US and FSC-Canada have provided templates for CLR Self-Assessment that borrows heavily on their Controlled Wood Risk Assessments. We expect most companies to take advantage of these templates, which greatly simplify things.
The subject of competency could become troublesome during this rollout. CoC certification has – until this year – been principally the domain of supply chain specialists. Auditors, consultants, and management representatives have been dropped abruptly into the scary world of human rights, wage standards, and civil justice. There may be some bumps along the way.
SFI 2022 Standards and Rules
The final and comprehensive update to the Sustainable Forestry Initiative (SFI) program Standards and Rules was published online yesterday. For industry insiders like us, this comes as quite a relief. It’s been a long, long wait.
The journey to the SFI 2022 update began back in early 2020 because the previous version of the standards was dated 2015-19 and is due for replacement. We knew there would be no update that year because the review and revision process was only just getting organized. A series of stakeholder meetings were scheduled that – of course – were prevented by the COVID19 pandemic. The result was predictable, frustrating, and unavoidable. Instead of an engaged and diverse discussion leading to real improvements in the program, there were a series of unproductive presentations by staff and an online forum with minimal participation. It seemed possible that we might have a revised standard ready to implement in 2021, but that didn’t happen. A theoretical final draft was finally released in April 2021, with approval promised late last year. This was then replaced with another “final, final” version in October that was officially approved by the Board of Directors in December and published just this week.
However, all of this would have been worthwhile if SFI had finally done the work necessary to finally align its standard with PEFC. Unfortunately, they just didn’t. We are at a loss to understand why this subject has remained unresolved for so many years. The latest, revised SFI CoC standard has been submitted to PEFC for endorsement, but it seems clear that little or no consideration to this process was given during the 2-year-long drafting phase. We hope to see some action on this matter in the coming months. Time will tell.
The single item of substance in the SFI CoC revision is the Due Diligence System (DDS) requirements. In short, SFI CoC-certified companies will – for the first time – need to conduct and document a DDS for their non-certified inputs. We see this as a positive development that finally aligns SFI with sister programs for product traceability, including (importantly) PEFC. There will be a few awkward discoveries during audits in the coming year, but implementation should be simple enough for most companies.
It is amusing to note that the revised PEFC CoC standard that is also going into effect in early 2022 is labeled “PEFC ST 2003:2020”. That is because PEFC completed its revision in 2020 on schedule and allowed a generous transition period before implementation. The roll-out wasn’t quite flawless, but the difficulties were confined to accreditation procedures necessary for auditing and certification processes. And also to the implementation of new auditor training requirements.
As with FSC and SFI, nearly all certified companies will be implementing and auditing the revised standard during 2022. PEFC-certified companies will see a new document that has been substantially revised and re-organized. We think most of the changes are quite positive. The standard is shorter, easier to read and understand, and better aligned with business practices. It is very difficult to predict the future importance of this standard in North America because it depends mainly on the outcome of the SFI alignment. We’ll have more to say on that subject when it becomes more apparent.
The Big Picture
Taken together, we expect that 2022 will be a challenging year for Chain of Custody business. This is based on the notion that change is usually difficult, and we have a lot of changes to digest in the coming year. The fact that we are entering into a third consecutive year of remote auditing will only make things harder for most of us. Will the pandemic conditions finally begin to ebb in the coming year and allow us to return to more normal practices? We don’t know. We certainly hope so.