Raising the Bar with Verifiable Progress

At Enviva, our business is about displacing coal and growing more trees. And when we say, “grow more trees,” we mean that we seek to be excellent forestland stewards and to help improve the health of forest ecosystems. We do that through our purchasing decisions, of course, but we also contribute to ecosystem health by doing other things – like helping to keep forests as forests; maintaining forest carbon stocks to help reduce the threat of global warming; conserving at-risk species and rare ecological communities; and helping landowners to engage in excellent forest management.

Our goal is to preserve the conditions that lead to a robust timber industry that includes biomass, operating within a healthy and vigorous forest landscape. To us, this means that working forests continue to provide a steady stream of products into the human economy, while at the same time biodiversity is protected with sufficient quality and quantity of habitat; endangered forests with special roles in the landscape are restored; and special or rare forests where logging isn’t appropriate are off-limits to harvest.

Enviva has worked since it was founded to develop a system of robust policies and procedures that we can use to make decisions about what wood to buy. More broadly, our sourcing and other practices are consistent with our core values of people and forests, as well as our values of accountability, integrity, discipline, and determination. It’s important to us that we do what we say we’re going to do, and our internal procedures, together with our investments in conservation, transparency, and supply chain tracking, have enabled us to make good on that commitment.

Continuous improvement is part of our operating philosophy. Just over a year ago Enviva began an expansive and data-driven review of how we might revisit and update the policies and procedures that define what we stand for as stewards of the forest landscape. While our systems were working well, we wanted to create a clear and succinct policy that we will use to guide our actions going forward. This is helpful for us internally, because a succinct policy on feedstock sourcing will help us to manage our purchasing decisions as we grow. But it is important for us to communicate our policy externally as well, so that our stakeholders know what we stand for. We want to be transparent about what we plan to do and how we plan to do it, so that our stakeholders can hold us accountable for doing what we said we would do.

Today, I am pleased to describe how we have enhanced and expanded our policy as well as how the implementation of our revised policy will allow us to continue to make progress toward broadly-shared desirable outcomes for our forested regions.

Our revised policy enables us to measure our progress toward these larger-scale goals while building on our core, foundational sustainable forestry standards. In our updated policy we maintain our bedrock commitments to sourcing only from working forests that will regenerate as forests, to protecting water quality through forestry Best Management Practices (BMPs), and to not sourcing from special or High Conservation Value (HCV) forests—particularly from four rare, sensitive bottomland hardwoods HCVs that we identified through extensive collaboration with the conservation community. We also are proud of our leading Track & Trace® (T&T®) system and the supply-chain verification and transparency it makes possible. That system enables our stakeholders to hold us accountable for sourcing only wood that meets our strict standards. And we have been proud to support and expand forest management certification, having enrolled over 60,000 acres in the American Tree Farm Certification System as of December 2018. In 2018, 23% of our incoming feedstock came from forests certified to leading forest management standards, and we expand our commitment to forest certification in our updated policy going forward.

Our review of our prior policy was partly internal, making sure our policy still reflects our values and needs, especially considering our growth. But our review was external as well. We reached out to independent organizations, agencies, and other experts to understand their views and concerns.

Developing the updated policy required deep coordination and collaboration across departments and teams within Enviva, to make sure we could attain what we were striving for in our prospective new policy in both financial and practical terms. Through the entire process, our partners at Earthworm (formerly known as The Forest Trust) have been our steadfast advisors. This is good news, because Earthworm has helped to guide numerous companies through the important work of updating their sourcing policies.

We carefully crafted our updated Responsible Sourcing Policy to simultaneously meet two critical objectives. First, based on our internal and external reviews, we knew we had an opportunity to demonstrate even more effectively Enviva’s leadership in sustainability by maintaining the highest standards of integrity, accountability, and discipline combined with our emphasis on continuous improvement. We wanted to build on our prior policy to make it even better, raising the bar for ourselves, and to do so in ways that can be verified by others. Secondly, we obviously have a business to run, meaning we need to keep making wood pellets safely and at reasonable cost, in order to fulfill our contracts and other financial obligations.

How Did We Enhance and Expand Our Policy?

Our new policy expands upon our prior set of policies in several concrete ways, from tract to landscape.  In the section below, we lay out the specific policy enhancements we made. In the section following that, we describe in more detail how we will, in 2019 and beyond, move toward implementation of these policy provisions.

Landscape-Scale Commitments

With our new Responsible Sourcing Policy, we are growing the scope and ambition of our activity beyond tract-level sustainability to acknowledge and support resolution of landscape-scale conservation issues and opportunities. As one example of this expansion, at the tract level, our standards of forest sustainability have always committed us to source only from working forest tracts that landowners intend to regrow as forest. Our revised policy extends this commitment to the landscape scale: the first provision in our new “pledges in conservation leadership” section commits us to collaborate with others to help keep the amount of forestland stable or increasing at the regional level.

In general, our new section on landscape-scale conservation issues and opportunities aims to support the work of many stakeholders to keep forests as forests, to keep certain critical forests standing, and to accomplish restoration goals. Across all these landscape-scale issues and opportunities, our collaborations will be focused on developing effective partnerships with conservation groups and private forest owners, who play particularly critical roles in conservation and restoration efforts in the Southeastern U.S.[1]

Forests with High Conservation Value:  Expanding our Approach

To take a more active role in helping to ensure that our forest regions move toward broadly-accepted goals related to future conditions, we are expanding our HCV policy and practices. Our commitment to work with the conservation community on identifying and protecting HCVs was clearly stated in our prior policy:

“We also know that there are special places in the woods that should remain so. Defining special places can be subjective, so we have drawn some bright lines: We do not harvest or source from old growth forests or other areas of special concern that we have identified in partnership with leading conservation organizations.” 

In our external review, we heard from conservation experts that, in addition to our existing detailed, rigorous bottomland hardwood HCV policy, our procedures would be materially stronger if we added protections for other types of HCVs across our sourcing regions, particularly for certain upland forests. Expanding our HCV policy and practices to include upland as well as bottomland areas will require extensive collaboration with outside experts to identify HCVs as well as the development of new internal procedures, as I explain below.

Third-Party Purchasing

In the past, to support our purchases of pellets from other manufacturers, we have relied on stringent and generally-accepted third-party certification systems to provide sustainability assurance. Our enhanced sourcing policy, however, has requirements that are additional to those typically included in such certification systems. In order to describe transparently the extent to which our pellet purchases are consistent with our revised policy, we are committing to a procedure for reporting on our pellet purchases as well as to reporting the extent to which those pellet manufacturers are meeting or exceeding our standards. This expansion in scope of our existing procedures required the development of a due diligence and supplier engagement process to ensure that prospective pellet purchases meet our stringent policy, even though some of these other producers work in areas of the world with very different forest ecosystems and forest industry practices.

Verification, Traceability, Transparency, Reporting, and Certification

Since it was established, our T&T system has undergone annual audits so that we could verify that we were adhering satisfactorily to our own internal procedures. With this release, we are committing to move the audit process upstream, such that we will be able to increase the auditability (and scalability of those audits as we continue to grow) of the T&T data provided by our partner landowners and suppliers. To do so, we will create a satellite-based imagery and monitoring system for quantifying key variables such as stand age, forest type, and tract size so that a third-party auditor will be able to verify the accuracy of the data reported.  These systems will further reinforce our commitment to transparency and verification.

We will also develop systems for reporting on progress toward the goals laid out in the revised policy. For example, we will report on the extent to which our purchased pellets are compliant, as well as how we progress with carrying out the tasks identified in our annual implementation plans. Finally, to augment our support for forest management certification under the Tree Farm system, we will begin supporting forest management certification under the Forest Stewardship Council (FSC) program.

Implementing Our New Responsible Sourcing Policy

When the rubber meets the road, how will we tangibly make progress on these diffuse, large-scale, and long-term challenges and opportunities? This is perhaps the most interesting and exciting part, at least for me, given my role at Enviva to develop and expand our collaborations with the conservation community.

Starting with this release, we will develop and share annual implementation plans that detail how we will further accomplish the goals laid out in our policy, better accomplishing them year after year, especially the pledges in conservation leadership. Below are some examples of our 2019 plans and how they will help us begin to implement our new policy. See the full set of implementation plans here.

Keeping Forests as Forests

At Enviva, we have always had a commitment to source only from working forests that the landowner intends to regenerate as forest. In the Southeast U.S., the incentive for a private landowner to keep land in forest use is market-based rather than a matter of regulatory policy, so it would be inappropriate for any landowner to commit to a particular action on his or her land as a condition of wood purchase by any forest products company, let alone one—like Enviva—that typically purchases volume comprising such a minor portion of the revenue. With the release of our expanded policy, we are committing to develop a satellite-based system to identify and report on land use change that may have occurred on tracts where we have purchased wood. We will create that monitoring system in 2019, and we plan to publish our first land use change monitoring report early next year.

In addition, in 2013 and 2015, we know that we sourced from one tract, Rhea’s Landing, that did not regenerate naturally, largely due to sustained flooding from the Roanoke River that was brought on by higher-than-normal rainfall combined with poor draining at the site. In 2018 and 2019, we partnered with the landowners, North Carolina Forest Service foresters and state nursery, and a planting crew to replant that stand to bald cypress. We will plant the seedlings at this site in early 2020, and we are pleased to have the opportunity to make things right at this location by upholding our commitment to keep it as forest when things stood in the way.

[1] For instance, see American Forest Foundation’s 2016 report entitled Southern Wildlife At Risk: Southern Forest Owners Offer a Solution https://www.forestfoundation.org/aff-releases-wildlife-report

Help Keep the Amount of Forestland Stable or Increasing at Regional Scales

While we can make specific sourcing decisions at the tract level about what we will and won’t purchase, we also recognize that there are broader forces driving change in our regions. Urbanization and development, for example, are real and growing threats to the forest landscape in the Southeastern U.S. We are committing to work together with others to influence large-scale outcomes on forest land, and to that end, Enviva joined the effort to support the reauthorization of the Land and Water Conservation Fund (LWCF), a critical land conservation program that expired in 2018. In addition to supporting and participating in the North American Forest Partnership (#forestproud) and the Keeping Forests as Forests collaborations, we will be looking for additional ways we can partner with colleagues in the conservation community, in government, and beyond to support other critical efforts to keep forests as forests.

 

Our Updated HCV Policy

To extend our HCV policy and practices across the full landscape, we are working with NatureServe to acquire additional, updated information about the range of HCVs across our entire sourcing region, following The HCV Network Approach to identifying and protecting HCVs. Through our collaboration with NatureServe over the course of 2019, we will acquire geospatial data detailing HCV types where sourcing isn’t appropriate in all types of forest, including bottomlands and uplands. In addition, we will acquire data on other HCV types, such as longleaf pine savannas, where experts in longleaf restoration and management believe appropriate, site-specific sourcing can improve the stand condition and habitat value. Beginning in 2020, we will implement our new HCV policy and practices, which will ensure that every upland tract from which we source wood—not just the tracts that might be sensitive bottomlands, as we do today—goes through an HCV screening and rigorous decision-making process before we agree to purchase any wood from it.

 

Certification

We are proud of our record on supporting forest management certification: as of 2018, one out of every 10 acres certified to the American Tree Farm System in North Carolina belonged to our Independently Managed Group. But many landowners still do not have access to a management plan, and we know we can do even better. In 2019, we will begin a new initiative with Forest Stewardship Council (FSC) Forest Management Certification, by working to help enroll 10,000 acres into the FSC system in 2019. We will also keep expanding our certification under the American Tree Farm System. At the end of 2018, we had helped enroll over 60,000 acres in Tree Farm enterprise-wide; by the end of 2019, our goal is to help enroll 30,000 additional acres, bringing our total Tree Farm certification to over 90,000 acres.

 

Longleaf Pine Restoration

As part of our pledge to help restore critical forest types, we are expanding our support for the restoration of longleaf pine forests, one of the most biodiverse forest types in North America and the focus of a concerted restoration effort across its historic range from Virginia and Texas.

 

I am honored and delighted to be working with leaders in the longleaf community on our longleaf restoration program, including Gary Burger, chair of the Longleaf Partnership Council, Robert Abernethy, president of The Longleaf Alliance, and many others. Robert Abernethy describes our collaboration in terms of how we will improve longleaf stand conditions:

 

“The Longleaf Alliance is excited to be working with Enviva on the restoration of longleaf stands through the removal of mid-story hardwood and the conversion of stands with a low percentage of existing longleaf into stands that have a lower basal area and a higher percentage of longleaf. We believe that working together we can restore longleaf in the landscape surrounding the Hamlet plant while providing income for the landowners in the area and a source of wood for the mill. We are laying the groundwork for what will be a model of forest restoration and utilization, and we applaud Enviva’s efforts.”

How Will We and Others Know How Well We’re Doing?

A key part of our policy implementation process will be to use verifiable metrics, such as acres conserved and restored. We will report our progress twice annually, with a mid-year qualitative report (such as “on schedule” or “ahead of schedule”) and an end-of-year report using the quantifiable metrics.

 

We are revising our internal processes related to things like HCV identification and protection, as well as record keeping and reporting, and we are developing external collaborations like our work on longleaf. As our work continues, we expect the scale and ambition of our annual plans will increase over time. Our work on the various policy provisions will vary year to year, given other internal priorities, external collaborations, and other factors. For instance, after our longleaf restoration program is more established, we expect to devote more work on other provisions of our policy.

 

We at Enviva know we can’t accomplish these ambitious goals on our own. We look forward to working more with partners from many sectors and in all of our regions. We know we can keep improving and better realizing our commitments toward the highest standards in sustainability. Our updated policy should create the framework, such that our annual plans can set in motion the processes for more and increasingly effective collaborations that lead to verifiable progress.

 

If you have ideas or suggestions of how we can accomplish the goals set out in our new policy, please don’t hesitate to email me.

 

As we implement our updated Responsible Sourcing Policy over the years to come, Enviva welcomes ideas for additional collaborative work to better accomplish widely-shared goals for our forested regions.