Using Blockchain Technology to Combat Illegal Logging
Illegal logging is an environmental crime that has been estimated to result in an annual global market loss of nearly $15 billion worldwide, felt along the entire supply chain from the small landowner to the highest levels of government. The highest rates of illegal logging activity are primarily in areas that also have the world’s richest biological diversity.
The 2008 amendments to the Lacey Act were adopted in an effort to stem the trade in illegal timber. However, the interpretation of ‘due care’ has given rise to various compliance and enforcement challenges. ForesTrust, LLC was introduced by the U.S. Endowment for Forestry and Communities (the Endowment) as the newest venture to take advantage of Blockchain technology, which has been recognized as one of the 21st century’s most innovative and powerful resources to combat illegal harvesting and trade. ForesTrust was developed to ensure transparency in the supply chain, offering the ability to accurately and efficiently track wood and wood fiber from the forest to the consumer and consolidate and ease the financial and administrative burden of forest certification.
ForesTrust offers the ability to trace provenance of fiber-based products, demonstrate sustainable sourcing, help ensure governmental compliance, and support corporate and public interests in environmental, social and governance (ESG) efforts.
Research into the viability of utilizing this platform for proof of origin and certification management concluded in late 2019. The Proof of Concept established that Blockchain technology provides a secure conduit for transparency and traceability across complex value chains and helps streamline the administrative components of complicated certification requirements. It demonstrated the program’s ability to provide a neutral infrastructure with technical control shared among users. In a system burdened with complex relationships across various regulatory frameworks, Blockchain can provide a tool to promote security and trust. Additionally, improving the ability to confirm the legality of wood and wood product sourcing is an opportunity to engender customer confidence, drive efficiencies, and assure conformance with sustainability objectives, thereby raising ESG scores.
“This project is a prime example of how industry can utilize the latest technology to solve long standing issues,” said Pete Madden, President and CEO of the Endowment. “By adding tools like these in the fight against illegal logging, we are working to combat mass deforestation, which is vital in the fight against climate change. This helps companies show customers, shareholders, and the public that they value doing things correctly and this provides the transparency to show they’re doing just that.”
“Domtar is proud to be among the first forest products companies to sign on to the ForesTrust block chain network,” said Paige Goff, VP of Sustainability at Domtar. “Our aim is to apply this safe and secure digital technology to improve supply chain transparency, tackle illegal logging and confirm wood product sourcing.”
“Domtar’s core principles include sustainability and innovation, which makes adoption of this next frontier of chain-of-custody accountability very exciting for us. When implemented across the breadth of the global wood supply chain, blockchain will ensure the chain of wood sourcing, from the forest to the consumer, is never broken, helping to preserve this most precious renewable resource for future generations,” Goff added.
“ForesTrust and this technology creates a way to show a product’s journey—from forest to final product. By having transparency into each step of the product’s journey, producers and consumers will have peace of mind about the origins of their fiber and richer insight into its journey and compliance inspections,” said Alicia Cramer, Senior Vice President with the Endowment. “ForesTrust provides an efficient way of working across the fiber supply chain for member landowners, harvesters, producers, logistic suppliers, retailers, regulators, and consumers.”
In working with IBM, ForesTrust will provide a safe and secure network that has the flexibility to accommodate forest industry standards. Companies interested in learning how they can be a part of the ForesTrust LLC Blockchain Network should contact Alicia Cramer, SVP, U.S. Endowment at alicia@usendowment.org or (205) 792-8650. **iw **
About the U.S. Endowment for Forestry and Communities
The U.S. Endowment for Forestry and Communities is a not-for-profit public charity working collaboratively with partners in the public and private sectors to advance systemic, transformative, and sustainable change for the health and vitality of the nation’s working forests and forest-reliant communities. To learn more about the Endowment, please visit their website at www.usendowment.org.
Frequently asked questions
What is the estimated global market loss from illegal logging?+
Illegal logging has been estimated to result in an annual global market loss of nearly $15 billion worldwide, affecting the entire supply chain from small landowners to the highest levels of government.
What is ForesTrust and who developed it?+
ForesTrust, LLC is a Blockchain-based platform introduced by the U.S. Endowment for Forestry and Communities to combat illegal harvesting and trade. It ensures supply chain transparency by tracking wood and wood fiber from the forest to the consumer and helps ease the financial and administrative burden of forest certification.
How does Blockchain technology help combat illegal logging?+
Blockchain provides a secure conduit for transparency and traceability across complex value chains and streamlines the administrative components of certification requirements. It offers a neutral infrastructure with shared technical control, promoting security and trust across regulatory frameworks.
What did the ForesTrust Proof of Concept demonstrate?+
Concluded in late 2019, the Proof of Concept established that Blockchain technology provides a secure conduit for transparency and traceability across complex value chains and helps streamline the administrative components of complicated certification requirements. It also demonstrated the program's ability to provide a neutral infrastructure with technical control shared among users.
Which company is among the first forest products companies to join the ForesTrust network?+
Domtar is among the first forest products companies to sign on to the ForesTrust Blockchain network. The company aims to use the technology to improve supply chain transparency, tackle illegal logging, and confirm wood product sourcing.
Who is the technology partner for ForesTrust?+
ForesTrust is working with IBM to provide a safe and secure network with the flexibility to accommodate forest industry standards.
How does ForesTrust support ESG efforts for companies?+
ForesTrust allows companies to trace fiber-based product provenance, demonstrate sustainable sourcing, and ensure governmental compliance. Improving the ability to confirm the legality of wood sourcing engenders customer confidence, drives efficiencies, and assures conformance with sustainability objectives, thereby raising ESG scores.