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Welcoming remarks by Mr. William Street, PEFC Chairman, at the 18th General Assembly Programme for the Endorsement of Forest Certification (PEFC) - Kuala Lumpur, Malaysia, 13 November 2013. What we believe We believe that the sustainable management of forests is critical for their survival. Since forests are living, adapting, and biologically complex entities, attempts to freeze them in a particular stage of their own natural successional processes are both fool hardly and fraught with peril. In a world of changing climates, forests cannot be saved by those with even the best of intentions who seek to create tree museums. In my own area of the Pacific Northwest in the US, we are seeing forests already beginning to adapt to climate change. Without the intervention of sustainable forest management prescriptions, this adaptation will include massive forest fires releasing substantial amounts of carbon into an already carbon constrained environment and endangering communities and species. Instead, with the use of the best science, sustainably managed forests can be an integral part of a transitional solution to the climate crisis through the advancement and use of carbon sequestering products. We believe that the well-being of the people who own, live in and depend on forests is the single most important criteria to determine if a forest is being sustainably managed. If the people who work in and depend on the forests cannot survive, then the forests themselves will perish. We believe it is possible to save forests, protect the species that live in and around them, and provide meaningful lives for our families, our co-workers, and our communities. In fact we believe this is the best way to save forests. We believe that both poverty and profit seeking endangers natural and human resources. The poor need to sacrifice the forest in order to survive. Any forest management plan that ignores this reality is doomed to fail. Likewise we recognize the difference between poverty

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driven deforestation and profit driven deforestation. Forest land use decisions are subject to the demands of the market and of the profits derived from markets. But this cannot be the only driver or the sole determinant of how we manage our forests. Profit driven forestry has created an enduring legacy. On the one hand it has created capital and wealth that has been used by global northern countries to develop their economies during the past century. On the other hand it has left a landscape that fuels an environmental backlash and erodes the political consensus required to manage our forests sustainably in the future. We cannot expect that nature will heal this damage by simply ignoring the forests or locking up hectares while we wait for nature to take its course. We no longer have the luxury of waiting for parking lots and suburban sub-divisions to revert back to forests. We have done too much damage and thus we carry on our backs the burden of the legacy of exploitive forestry practices of the past. The way forward here, as with so many aspects of Sustainable Forest Management, is to find the balance point, a balance point between making a sustainable economic contribution to society and no economic contribution to society. If forests cannot make a substantial economic contribution to society they will be replaced by palm oil plantations, soy bean fields, cattle pastures, golf courses, and destination resorts. We believe there are special places that are so important that they need to be managed with special care. Care that not only ensures the survival of what makes a particular forest unique, but also care that enables those who are forest dependent to thrive. We believe that the wealth of the forest must be shared by all, those who toil in the daily tasks of stewardship as well as those who benefit from their investments in forests. Small forest landowners who own a few hectares as well as government landowners who control millions of hectares must all share from the wealth of the forest. This wealth is far more than any market has ever been able to price. Smallholders, be they in the EU or Mercosur, must garnish their fair share of the wealth they labor so hard to create. Likewise, governments of the global north cannot continue to appropriate a disproportionate share of the wealth of global southern forests on the one hand while seeking to force the forest managers of these very same tropical forests to condemn their own populations to poverty. We believe that wood is good. That society is better served by the use of wood fiber based products than by any of the alternative substitutes. We believe that the best way to achieve these goals is through an inclusive process that recognizes that there is no single way forward for every forest type. We believe there is not

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even a best way applicable to all forests, but rather that the process of bottom up, stakeholder involvement that gives voice to those who rarely have an opportunity to be heard is the only way forward. Smallholders, native and indigenous populations, workers, women, minorities, as well as Fortune 500 multi-nation corporations and government land owners must all have a seat at the table where the decisions are made as to how to manage a specific forest. And, yes, it is equally important to include urban dwellers who may never have step foot into a forest, and suffer from a romanticized notion as to what forests actual are and can do, also they must have a seat at the table. But, they should never have a majority of the seats. This is what we believe. Not with one mind and certainly not with one voice, but nevertheless this is what we believe. This is how we make decisions on a day to day basis. We seek to include, not exclude, any one from the debate. We seek to find solutions to the complex problems of each unique type of forest in our National Governing Bodies rather than dictate a one size fits all approach. We celebrate the diversity that such an approach empowers. We celebrate it as the output of a rich, diverse, multi-cultural process. Thus it should come as no surprise that we believe that the culture and the economic development of a nation or a community within which our certified forests reside must be considered as they create their own plans for sustainable managed forests. For these beliefs we pay a price. Even though we are the largest forest certification system in the world with the most diverse forest landscapes and the most rigorous standards derived from the most inclusive and democratic processes. Even though by any definition of economically efficient or rational we are the best forest certification system in the world; we to this day continue to face unwarranted and unjustified attacks. During the past two years, the PEFC family has spent more than 1.5 million dollars defending our system against the well-intentioned but structurally flawed TPAC process in the Netherlands. Some of this attack is funded by those who have an immediate economic gain and should we not be recognized. Others seek political advantage, while still others simply have insufficient knowledge of the complexity of tropical forests. I keep asking myself, how many more hectares of tropical forest could PEFC have saved and protected, how many more forest dependent homes and communities could have been saved if we could have invested that 1.5 million dollars on the ground creating sustainably

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managed forests instead of demonstrating to TPAC the unsubstantiated complaints by NGO in an exhaustive four year process that confirmed at every stage that PEFC delivers sustainability as defined in the Dutch criteria. Our concern is that the process remains flawed and risks its demise as the similar processes that preceded it. Some people seem to honestly believe that by penalizing forest certification efforts in Malaysia they will improve forest management in Malaysia. They do not realize that the global markets they created and support which provide profits from palm oil at rates three times greater than natural forests will drive conversion and the dislocation of indigenous peoples at a rate infinitely faster than today. Instead of attempting to dictate to Malaysia, perhaps they might get the outcomes and results that they want and that PEFC wants by working with us and supporting the efforts of MTCC to stop deforestation and protect the natural primarily forest. We believe that what we do here today and throughout the year, in our own countries, builds the foundation for our children and our childrens children, to enjoy the wealth of the forests we are managing today. While we may not be the best at explaining this or marketing it to the world, we know what does create value for future generations, even if sometimes our own stakeholders and members lose track of this from time to time. We remain strong in our beliefs. As we move into the future, whatever conflicts come our way, whatever challenges we will face, either external or internal, I know that our beliefs will hold us together. What our European founders created in Paris many years ago, is today simply the best forest certification system anywhere. Thank you

William Street is Chairman of PEFC International. William Streets experience includes: Director of Research and Education of the International Woodworkers of America, US, the largest US labour union representing forest and mill workers; Director of the Global Wood and Forestry Program for the International Federation of Builders and Woodworkers (now Builders and Woodworkers International), a global trade union federation; he is currently the Director of the Woodworkers Department of the International Association of Machinists and Aerospace Workers, one of the largest industrial trade unions in North America. In addition to his work in industrialized countries, Mr. Street has directed forestry projects in Ghana, Burkina Faso, Kenya, South Africa, Brazil, Chile, Indonesia, India, China, and Malaysia. He holds a Master of Science in Politics & Government from the University of Oregon and has written on poverty reduction and sustainable forestry.

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