Canadian home improvement giant Rona Inc. has adopted a tough new lumber-buying policy that Greenpeace says is going to change the way suppliers log Canada’s forests.
Story by Gordon Hamilton, Vancouver Sun, November 22, 2008. Click here for link to original story.
Rona wants to “do the right thing,” executive vice-president Normand Dumont said Friday in announcing new environmental standards for the lumber sold in its stores.
The policy raises the bar on ecologically sensitive logging by setting a firm date for selling nothing but certified lumber. But it is controversial as it favours one certification system — the Greenpeace-supported Forest Stewardship Council® — over others.
Dumont said Rona recognizes all three main certification systems in use in Canada but prefers FSC® because the company believes it is the most vigorous on two critical criteria: first nations involvement in forestry and conservation of biodiversity.
The new buying policy comes at a time when Rona is taking a high public profile as a national partner in the Canadian Olympic program. It has committed $68 million to a number of Olympic programs in exchange for exclusive Olympic rights, and is expected to be highly visible — and vulnerable to campaigns by eco-groups — at the 2010 Winter Olympics.
Investment analyst Kevin Mason, of Equity Research Associates, said Rona may have been pushed into favouring the FSC® program by environmental activists, “but it’s also true that more and more, customers are demanding it.”
Mason said the other leading certification systems are as thorough as FSC® but do not have as high an awareness among consumers.
He said Rona is telling forest companies: “If you want to be a player in the game, this is the cost of entry now.”
Certification programs cost forest companies more, he said, as they must set up monitoring systems and then pay to become certified. But so far, certified lumber does not sell for a premium.
The value to certified lumber producers, he said, is that they are the last ones to be cut by buyers when demand for lumber drops.
Rona’s new buying policy requires:
- One-hundred per cent of the company’s lumber must come from eco-certified sources by the end of 2010.
- Panel products will have to be eco-certified by the end of 2009.
- Twenty-five per cent of lumber sold at Rona must bear the Forest Stewardship Council® certification logo by 2012.
- All suppliers have a chain-of-custody procedure in place by the end of 2011 that traces the wood products back to the forests where they came from.
“They are one of the largest lumber purchasers in the country. This is going to have a ripple effect,” said Greenpeace forest campaigner Richard Brooks. “It’s miles ahead of Home Depot and Lowe’s.”
The Rona store network generates annual sales of $6.3 billion a year. Ten per cent of that — $630 million — is in lumber purchases, giving the company significant purchase power in the forest sector.
“This is going to lead to changes on the ground,” said Brooks.
Forest companies with BC operations that Rona buys from include West Fraser Timber, Interfor, and Tembec. Tembec has FSC® certification in its eastern BC operations while West Fraser operates under another certification system.
Interfor vice-president Ric Slaco said he expects Interfor will remain a preferred supplier to Rona, as it has chain-of-custody in place and is taking part in the ecosystem-based management program in the Great Bear Rainforest on BC’s Central Coast. It is widely viewed as one of the country’s most ecologically-advanced forest management experiments.
“I think Rona is talking about trying to reward suppliers who are being environmentally responsible,” Slaco said. “All the work that’s been done on the Central Coast is about biodiversity. I think [Rona’s policy] is very workable for us.”