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Photo shows people breaking up babacu in Maranhao, Brazil

Why is FPIC important for deforestation-free supply chains?

by Emma Mutch

Highlights

  • Free and Prior Informed Consent (FPIC) is a crucial component for all companies who are aiming for sustainable and ethical supply chains.
  • The preliminary results from the latest Forest 500 assessment of 350 companies suggest that companies are most likely to have an FPIC requirement for palm oil sourcing.
  • Much more needs to be done to ensure companies include FPIC in their sourcing policies/standards for all forest-risk commodities.

Free, Prior and Informed Consent (FPIC) is the human right for indigenous peoples and local communities to give or withhold consent to any proposed activity that may affect them or their territories. This is relevant to any company sourcing forest-risk commodities (e.g. palm, soy, timber, cattle and others), as these commodities are often produced in areas that overlap with indigenous lands.

Incorporating FPIC into sustainable sourcing commitments is recommended by the Accountability Framework initiative, which aims to develop a consistent framework for companies to deliver on zero deforestation commitments. It should also be required by financial institutions lending to or investing in forest-risk commodity supply chains – as outlined in guidance by SCRIPT. Financial institutions can face material risks from financing companies in violation of human rights.

FPIC is key in giving indigenous peoples and local communities collective rights over what happens in their territories, even in cases where there is no guarantee that they are protected under national laws.

Companies must respect this right, and have previously been called out for being complicit in violations of FPIC when sourcing from regions where plantations have been developed without prior and informed consent, sometimes with devastating impacts for local livelihoods and cultures.

The first step that companies can take is to make commitments that require suppliers to ensure FPIC through their procurement policy and standards.

Gaps in existing company policies

Global Canopy’s Forest 500 assessment identifies and ranks the most influential companies and financial institutions in forest-risk commodity supply chains. Companies ranked as part of the Forest 500 are assessed on their commitments to require FPIC as part of a full assessment on their deforestation and sustainable-sourcing commitments.

Only a quarter of companies assessed in 2018 had an FPIC commitment for at least one commodity, according to the preliminary results. About a fifth of all companies have an FPIC commitment in relation to palm oil, in contrast to under a tenth for paper. Both soy and cattle are even less than this.

Previous Forest 500 Assessments have shown that companies are more likely to have commitments for palm oil than for soy or cattle. Deforestation caused by palm oil has been high on the news agenda (e.g. the Iceland palm oil advert), creating greater public awareness and pressure. This is likely to have led companies to be more transparent about their palm oil sourcing.

However, even companies that have commitments for multiple commodities are more likely to have an FPIC commitment for palm oil, rather than requiring FPIC across commodities, as seen at IKEA and Subway.  

Photo shows community members watching an excavator tearing down and digging a drainage canal in Borneo, Indonesia
Digging a drainage canal for a palm oil plantation in the forest in Borneo, photo: Rainforest Action Network via flickr.com, creative commons licence

How can buyers ensure FPIC is being implemented by their suppliers?

Retailers and consumer goods companies sourcing forest-risk commodities should require and monitor suppliers to ensure communities are being properly informed and consulted about potential new plantations. These companies should ensure their suppliers provide proof that they have followed the FPIC process.

Companies can also use certification schemes such as the Roundtable on Sustainable Palm Oil (RSPO), the Forest Stewardship Council (FSC) or the Rainforest Alliance when buying commodities as these schemes all require FPIC. However, an explicit FPIC commitment on a company’s website, or in a sustainable sourcing policy, is a stronger signal to suppliers.

For the case of soy, the Roundtable on Responsible Soy has a weaker principle for FPIC which is related to compensation for losses rather than free and informed prior consent to the development. This means that companies sourcing soy need a human rights commitment that goes beyond the RTRS voluntary standards.

What needs to be done?

Three quarters of the most influential companies sourcing and trading agricultural commodities from tropical forest regions do not include FPIC in their sourcing policies. This is unacceptable.

Companies that have policies for all of their commodities, but who only require FPIC for palm oil, should extend those other policies to include FPIC. Companies such as Marks & Spencer and Unilever have already done this  

As more companies commit to the sustainable sourcing of other forest commodities,  understanding both the social and environmental impacts of supply chains is crucial to ensuring greater sustainability. Recognising and requiring FPIC in all commodity supply chains is fundamental to this.

Top photo shows: Comunidade quebradeira de babaçu in Maranhão, Brazil. Common and traditional activity in Matopiba, Brazil, copyright: Andre Vasconcelos

Second photo: Local communities watch as a drainage canal for a palm oil plantation is dug in the forest in Borneo, photo: Rainforest Action Network via flickr.com, creative commons licence