Consumers are increasingly seeking sustainable, environmentally-friendly products, including wood and paper products. In fact, many consumers are willing to pay more for eco-labeled goods that come from "well-managed forests." Often times, that eco-label means that the wood was certified to have met the standards set by one particular international forestry certification organization, the Forest Stewardship Council (FSC).
While that is true that the wood is certified, the reality is that not all FSC-certified wood meets the same standards. This means that consumers may not be getting exactly what they paid for.
FSC's certification standards vary by country. In other words, there really is no "international" standard. FSC lists 38 separate standards on its website, and even these get enforced at various levels. For example, FSC has no limits for clear-cutting in countries like Russia and Brazil, whereas the strictest standards are applied in the U.S.
What does that mean for consumers? Just confusion. With 90 percent of FSC wood being harvested outside of America, where environmental protections lag far behind ours, consumers are paying a premium for eco-labeled wood that might be coming from the most environmentally-risky areas of the world.
It's not just consumers that are getting duped, but so are environmentally-minded government agencies that are mandating "LEED" standards in their buildings, schools and municipal projects. LEED standards give "credits" for wood certified by FSC but not for other programs such as the Sustainable Forestry Initiative and the American Tree Farm System. The LEED bias toward FSC means that tens of millions of acres of certified American forests are being overlooked.
These differences in certification standards could mistakenly lead a Washington State resident who wants to protect streams to overlook "uncertified" wood from Washington State and purchase FSC-wood from another country, without realizing that FSC provides less protection for streams in that country than in the US.
If the goal of LEED is to increase sustainability, its adoption of FSC as the sole standard is a setback. FSC's disparity in standards across the globe ironically means that FSC may incentivize the harvesting of wood in more environmentally risky locations. A standards bias for foreign wood would also lead to the increased importation of foreign wood, thereby adding transportation costs and creating other environmental harms. In addition, the higher costs of this wood could push some consumers to substitute to less environmentally-friendly materials, such as metals, concrete and plastics. How is this good for the environment?
Besides missing the mark on the environment, the higher costs of FSC are not trivial - raising, by some estimates, consumer costs in the range of 15 to 20 percent. In my coauthored study, we estimated the US consumer welfare losses from an FSC standard to be $10 billion per year for wood products and $24 billion per year for paper products.
There are also economic consequences from buying wood overseas that could be produced in the U.S., according to a new study from EconoSTATS at George Mason University. The study found that state-level implementation of FSC in Oregon could reduce employment by over 31,000 jobs and decrease annual severance tax revenue by over $6 million. In Arkansas, the FSC-Plantation standard could decrease employment by 10,000.
These findings have significant implications for how policymakers should proceed. LEED projects, which number in the thousands and grow each year, give preference to FSC timber. Since this wood is more expensive, government policy artificially increases the costs of building materials in public projects, with taxpayers footing the bill.
The fact is that the certification bias does little to help consumers, government, the economy and the environment. Competing standards can balance resource sustainability with economic viability, and consumers will know what they are getting for their money.
The bottom line is that buying FSC-certified wood from a country where the standard imposes weaker environmental protections only serves to reduce jobs here in the U.S. and leave consumer pockets a little emptier.
It is time to end the confusion and help consumers make better environmental choices.