• Timber trade experts allege the Forest Stewardship Council lacks the ability to proactively detect fraud throughout its global supply chains.
• They hope the body will change, with a vote on whether to lay the groundwork for a new volume tracking system slated for this coming week.
• The FSC has dismissed some broad estimates of fraud within its network as unsubstantiated, but a senior FSC official who spoke to Mongabay on condition of anonymity said it remains widespread.
• A new report by Earthsight estimates the value of FSC fraud at billions of dollars per year and says the body’s reputation for ensuring sustainability is on the line.

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The world’s largest green timber label will vote next week on whether to begin work on new traceability rules, amid renewed scrutiny and accusations over whether the body is doing enough to prevent fraud within its supply chains.

The Bonn-based Forest Stewardship Council (FSC) bills itself as “the world’s most trusted mark for sustainable forestry.” Its tree-tick logo can be found on everything from furniture and snowboards to toilet paper and takeaway containers, an assurance the product was made with wood from forests the FSC has certified as responsibly managed. FSC certification appears on products worth tens of billions of dollars in sales each year.

But forestry experts and whistleblowers have alleged for years that the FSC lacks a proper control system, allowing bad actors to fraudulently pass off timber that was illegally or unsustainably logged as FSC-certified. Phil Guillery, who was the FSC’s integrity director from 2011-21, said in early October that he believed “20-30% of claims in the system were false” during his tenure “and I haven’t seen anything to suggest the figure has dropped since.”

The FSC issued a swift rebuttal to Guillery’s claims, calling them unsubstantiated and “based on outdated information that does not reflect the system today.”

“Integrity is central to FSC’s mission, and we take any allegation of fraudulent behaviour seriously,” the FSC said.

However, a senior FSC official currently with the organization told Mongabay this week that they believed the figure was actually an underestimate.

“I’m actually amazed he said 20-30 percent — probably the numbers are higher,” said the official, who agreed to an interview on condition of anonymity for fear of reprisals.

The official alleged that FSC fraud remained widespread and that little of significance was being done to address it. Mongabay verified the official’s identity and current position.

FSC-certified wood in Peru. Image by Rhett A. Butler/Mongabay.

At present, companies up and down FSC supply chains — from forest to processing to shipping to point of sale — are able to buy and sell timber and wood-based products as FSC-certified without reporting the volumes changing hands to the FSC itself. This means the FSC has no centralized way to ensure that the material entering its supply chains as certified matches the volumes reaching the market at the other end.

Third-party auditors review individual traders’ invoices annually, the FSC told Mongabay in a written statement. But no one routinely analyzes transactions among traders for signs of fraud, a process known as volume tracking and reconciliation, forestry experts told Mongabay.

“It’s a trust-based system,” Sam Lawson, head of U.K. investigative NGO Earthsight, said in an interview. “What companies are doing rampantly is selling far more FSC products than they buy FSC timber. So they’re basically slapping an FSC label on wood that’s coming from somewhere else entirely.”

Earthsight published an analysis this week that estimates the total amount of FSC fraud at $10-30 billion per year. Three cases it cites as examples were worth, it estimated, $100 million, $50 million and $100 million. Mongabay was not able to independently verify the figures.

The FSC said it is working to combat fraud, arguing it has “increased the use of transaction verification, wood sample testing, and targeted investigations to identify and block companies who make false claims.”

Transaction verification is when the FSC tracks a product down its supply chain, getting the volume numbers from each company that handled it along the way and checking if they match.

But without a unified data system, the process relies on hunting down paper records and can take 1-2 years, by which time falsely labeled products have long since reached consumers, said Peter Feilberg, executive director of sustainability nonprofit Preferred by Nature.

“It’s a very, very tiny share of the total volume floating through the FSC system that they can cover with this approach,” Feilberg told Mongabay.

Scientific testing to determine wood origin is also limited in scope, as it can’t detect when uncertified wood of the same species and same country is passed off as certified, according to Earthsight.

Lawson said the FSC typically acts against fraud only when an NGO or journalist identifies it first. Earthsight’s report says that of the 10 cases the FSC has confirmed on its website as fraud since 2017, all but one were apparently triggered by third parties.

The FSC told Mongabay this week that its oversight was “proactive” and that “information from journalists, NGOs, and whistle-blowers are just some of the sources that trigger investigations.” It did not cite examples.

“FSC invites anyone with credible evidence of false claims to share it through our established reporting channels,” the FSC said. “Where verifiable wrongdoing is identified, we investigate and take enforcement action.”

Earthsight further noted that since 2022, when Russia and Belarus were kicked out of the FSC due to Russia’s invasion of Ukraine, the area of FSC-certified forests around the world has fallen by 30%, yet the number of companies licensed to handle FSC wood has increased by 37%, raising questions among watchdog groups about whether timber from those two countries is being smuggled into FSC supply chains.

Previous undercover work by Earthsight found that sanctioned Russian and Belarusian timber was being laundered into the EU in breach of government sanctions, including by some FSC-certified companies. And a recent chemical testing analysis found that large portions of birch wood certified by the FSC did not come from the labeled country of origin, with experts pointing to Russia and Belarus as the likely source.

“Things don’t add up when you look at the growth of FSC certifications,” the anonymous FSC official said, noting the apparent discrepancy with Russia.

The FSC told Mongabay that the growth of certified companies since 2022 “reflects market demand and recognition of FSC standards.”

FSC-certified timber in China, where cases of FSC fraud involving sanctioned Russian timber have arisen. Image by Rhett A. Butler/Mongabay.

A proposed resolution on the table at the FSC’s general assembly in Panama, taking place Oct. 26-31, would lay the groundwork for the creation of a volume tracking and reconciliation system that every FSC company would be required to participate in.

“Currently, false claims are possible because FSC’s existing controls are not able to prevent them,” reads the text of the resolution, known as Motion 30, which was put forth by U.K. retailer Kingfisher and seconded by WWF.

The FSC is currently rolling out a blockchain-based traceability system called FSC Trace, but it is intended to be mandatory only for supply chains it deems “high risk”. But Earthsight says fraud has been uncovered across “a vast array of FSC-certified products” and “exposed all over the world.”

“There is no such thing as a ‘high-risk supply chain’ — they’re all high risk,” the anonymous FSC official told Mongabay.

To pass, the motion would have to be approved by a majority of each of the FSC’s three chambers — environmental, social and economic. The latter consists of the body’s corporate members and has voted down similar traceability measures in the past.

The latest version of Motion 30, seen by Mongabay, would initiate a study of how such a system could be implemented across the supply chain, with a vote on whether to adopt it slated for the next general assembly in 2028.

“One thing that we recognize is this is a big deal, it’s a big change, it’s going to impose additional costs and burdens of time and hassle on certificate holders all across the system,” Jason Grant, FSC lead for WWF, told Mongabay in an interview.

“We don’t want to break the system by forcing this on people too quickly without enough thoughtful work to make sure that it really works.”

Grant added that FSC oversight did need to change from “a reactive…to an active system.”

Earthsight wants to see Motion 30 passed but is also calling for an amendment that would require the system to be adopted without a 2028 revote, as earlier versions of the motion did.

The watchdog says the FSC’s credibility is at stake and that NGOs should walk away from the body if volume control is “vetoed” once again by the economic chamber.

“If there’s one single thing that would change FSC, it’d be if WWF just grew a backbone and genuinely threatened to leave if X, Y and Z weren’t done,” Lawson told Mongabay. “FSC is greatly dependent on the credibility associated with the panda logo.”

Feilberg said that while he had hope for the FSC and “strongly believe[s] it makes a difference in the millions of hectares of certified forest,” the body “has reached a scale where a lot of wood that should never enter the FSC-certified supply chain is entering the supply chain.”

If the FSC’s tree-tick mark were seen as greenwashing and the market for its products disappeared, he said, companies “would potentially just drop it, and that would not be good for the world’s forests.”

Hope and frustration as Indonesia pilots FSC’s logging remedy framework

Banner: FSC-certified timber in Indonesia. Image by Rhett A. Butler/Mongabay.