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  • Planted forests in emerging economies: Best practices for sustainable and responsible investments

Planted forests in emerging economies: Best practices for sustainable and responsible investments

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Authors: Brotto, L.; Pettenella, D.; Cerutti, P.O.; Pirard, R.

Investments in industrial-scale planted forests have grown exponentially in recent years and are included into investment portfolios for various reasons (e.g. diversification, risk mitigation, attractive returns). The rapid growth of planted forests may incur negative social and environmental impacts. Thus, investment companies and fund managers are increasingly interested in using sustainable and responsible investment (SRI) tools (e.g. standards, guidelines, and codes of conduct). However, a classification system for SRI tools in the field of planted forests still lacks consensus.

The present study under the CGIAR Research Program on Forests, Trees and Agroforestry therefore identifies, describes and analyzes SRI tools for planted forests and suggests a framework for the evaluation of their capacity to address environmental, social and governance (ESG) issues.

Four key findings emerged:

  • More than 50 SRI tools are used to categorize investments in planted forest. The most common SRI tools used are management standards, bank investment policies and investment rating systems.
  • An ESG Reference Document allows a quality assessment of the SRI tools to be undertaken. The most important issues highlighted in SRI tools are: legality, environmental impact and third-party certification. Conversely, issues such as poverty alleviation, minimum percentage of protected areas and prevention of encroachment are not properly addressed.
  • SRI tools with the highest overall performance originate from the Forest Stewardship Council (FSC), Gold Standard, RepRisk, Certified B Corporation and FairForest and also include the WWF Responsible Investment Guide and the FTSE4Good Index Series.
  • It is important that planted forests are evaluated either through specific SRI tools, or at least with appropriate consideration in order to properly address risk factors such as improvement of livelihoods and the prevention of encroachment and conflicts.

CIFOR Occasional Paper no. 151

Published 2016 at Center for International Forestry Research (CIFOR)

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  • Legal frameworks enabling sustainable land-use investment in Mozambique: Current strengths and opportunities for improvement

Legal frameworks enabling sustainable land-use investment in Mozambique: Current strengths and opportunities for improvement

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The International Development Law Organization (IDLO) and the Center for International Forestry Research (CIFOR) assessed the legal frameworks that govern land-use activities and investments in Mozambique. Mozambique’s legal framework for environmental management is well developed, and recent legal reforms have strengthened key public interest safeguards. Similarly, the country has established a comprehensive framework for investment through the Investment Law and Investment Promotion Centre (CPI), and enshrined in the Land Law the right to the use and benefit of land (DUAT). The Environmental Impact Assessment (EIA) process places public consultation at the heart of effective environmental management. It extends participation to a broad spectrum of stakeholders at an early stage, allowing, in theory, substantial influence over the design and implementation of the EIA process. The National Council for Sustainable Development (CONDES) and the Ministry for Environmental Coordination (MICOA) have not managed, however, to influence high level government policy decisions and push convincingly for a sustainable development agenda.

The key weaknesses of Mozambique’s environmental safeguard system, Investment Law and Land Law include the short timelines to review investment proposals by CPI and sector-specific authorities; a focus on economic outcomes; the inability to monitor and enforce existing laws and regulations; inadequate compensation mechanisms; limited funding to enable MICOA and CPI to oversee the critical public consultation phase and monitor compliance with Environmental Management Plans; ineffective information dissemination, and threats to the independence of the public consultation process; and poorly qualified EIA consultants. The mining industry is distinguished by serious gaps in its accountability framework.

This Legal Assessment report for Mozambique examines policy, institutional and legal frameworks in the agricultural, energy, forestry and mining sectors and identifies four key challenges to the attainment of sustainable land-use investments, viz.

  • Weak enforcement of environmental and social safeguards;
  • Lack of incentives in the legal framework;
  • Insecure land tenure;
  • Low public awareness and limited access to information.

Source: CIFOR publications

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