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Illegal Logging, Corruption and Business

Illegal Logging, Corruption and Business. Presented by Ken Rosenbaum Sylvan Environmental Consultants On behalf of the Forest Integrity Network. What is the Forest Integrity Network?. FIN is an informal network of professionals concerned about corruption.

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Illegal Logging, Corruption and Business

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  1. Illegal Logging, Corruption and Business Presented by Ken Rosenbaum Sylvan Environmental Consultants On behalf of the Forest Integrity Network

  2. What is the Forest Integrity Network? • FIN is an informal network of professionals concerned about corruption. • FIN emerged from a 2000 conference on forest sector corruption at Harvard. • FIN’s focus is unique. • FIN is now a project of Transparency International.

  3. Recent FIN Activities • FIN produced a paper on tools for civil society to fight forest-sector corruption. • FIN reviewed a pilot project to source wood fiber responsibly from Russia. • FIN is turning its attention to approaches for responsible businesses. • FIN will be hosting a panel on business issues at the IACC in Guatemala in November

  4. Why are we talking about corruption?

  5. Corruption is the Enabler and Accomplice of Illegal Logging

  6. Corruption has been the Inconvenient Elephant that no one wants to mention:

  7. A Miniature Case Study: with apologies to …

  8. The Home Depot has a strong environmental policy

  9. In particular … • The Home Depot has traced the origin of every wood product on its shelves. • The Home Depot will not accept imports of rare species such as Intsia bijua (Merbau) unless the supplier provides the export permit.

  10. So how did this happen?

  11. It’s really no surprise. • The forest sector has a poor reputation for honest operation in much of the developing world. • The good people in Indonesia are working hard to build honest governance, but they may not have succeeded yet. • In these conditions you can trust the paperwork.

  12. What’s at risk for your business? • Shame: Bad Press • Fines and Jail (Foreign Corrupt Practices Act, Lacey Act in US) • Unequal Competition and Closed Markets: When your adversaries play a dirty game

  13. Forest Businesses are coming to recognize the problem

  14. Weinberg’s Pickle Principle When you add a cucumber to brine, the cucumber generally gets more pickled than the brine gets cucumbered.

  15. A small system that tries to change a big system through long and continued contact … … is morelikely to get changed itself

  16. This holds true for: • The small CSR office trying to change a large business organization • The arm of a business functioning in the economic and social milieu of a different culture • The small certification system exposed to business practices in a large society

  17. Not everything in brine gets pickled • There are ways to counter the pickle principle • They require organization and management • Enter the Business Principles

  18. The Business Principles for Countering Bribery • Started 2000 • International steering committee • Broad based membership • Consultation and three field tests • Released late 2002; rollout from 2003

  19. BP plc General Electric HSBC ISIS Assets Management Norsk Hydro ASA Organización Corona Pfizer PricewaterhouseCoopers Rio Tinto plc SAP SGS Société Générale de Surveillance S.A. Shell International Sika AG Tata Sons ltd Business Members

  20. What are theBusiness Principles? • Anti-bribery framework for business promoting: • Good business practices • Risk management • For use by companies of all sizes

  21. Basic Elements Parallel Environmental Management • Adopt high-level policy against corruption • Make resisting corruption everyone’s responsibility • Communicate this to employees • Set up internal controls & audits • Etc.

  22. Step 1 2 3 4 5 6 Action Develop ABP tailored to the business Decide to adopt an ABP Plan imple-mentation Imple-ment Monitor Evaluate Primary responsibility Owner of company/ Board/ CEO Appointed senior manager/ Project Team Appointed senior manager/ HR dept Appointed senior manager /line managers/ HR depts/ business partners Ethics officer/ Internal and external auditors Owner of company/ Board/ CEO/ Audit Committee Time span One month Three to six months Three to six months One year Continuous At least annually Six step implementation plan

  23. FIN: Andrea Figari  fin@transparency.org Programme Manager, FIN Transparency International Alt Moabit 96 10556 Berlin, Germany  +49-30-3438 20655 +49-30-3470-3912  www.transparency.org/fin Business Principles: At TI-UK: Peter Wilkinson At TI-USA: Susan Côté-Freeman Contact Information

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