●Current Situation

The World

Sustainable forest management around the world

Countries around the world have promoted sustainable forest management in many aspects. Governments have realized the importance of sustainable forest management and the strategic key to national net-zero policies and have formulated many new regulations and systems on forest management.

Countries established the “REDD+” framework to protect forests as part of the Paris Agreement. “REDD” stands for “Reducing emissions from deforestation and forest degradation in developing countries.” The “+” stands for additional forest-related activities that protect the climate, namely sustainable management of forests and the conservation and enhancement of forest carbon stocks. Under the framework with these REDD+ activities, developing countries can receive results-based payments for emission reductions when they reduce deforestation. This serves as a major incentive for their efforts.

The State of the World’s Forests 2022 says that forest investment is well below what is required. Domestic public expenditure on forestry far exceeds official development assistance and (tracked) private finance flows, even in some low-income countries. In 13 sub-Saharan African countries, national governments spend 3.5 times more on forestry than the amount received for this purpose as official development assistance. Ecological fiscal transfers, implemented in only a few countries to date, amount to 20 times the global official development assistance for forestry.

There are at least five high-potential areas for scaling up implementation of the forest pathways – (1) greening public domestic finance; (2) making climate finance work for forest-based approaches; (3) greening financial markets with regulatory and supervisory tools, with the clear positioning of forest-based approaches; (4) developing pipelines of investment-grade projects; and (5) supporting investment in value-added wood processing in countries of origin.

The three interrelated pathways are halting deforestation and maintaining forests; restoring degraded lands and expanding agroforestry; and sustainably using forests and building green value chains. The balanced, simultaneous pursuit of these pathways can generate sustainable economic and social benefits for countries and their rural communities, help sustainably meet increasing global demand for materials, and address environmental challenges.

Joint public and private initiatives can deliver efficient solutions, and enhanced combinations of landscape approaches with supply-chain governance hold promise as responses to sustainable land-use challenges.

Source: FAO

China

China's innovative forest management mechanism

Image source: National Forestry and Grassland Administration

In March 2023, the National Forestry and Grassland Administration released the “National Sustainable Forest Operation Pilot Implementation Plan (2023-2025)”, which plans to spend three years carrying out sustainable forest operation pilots across the country to drive all kinds of pilot demonstrations. Various regions shall improve forest quality, adjust forest structure, innovate management mechanisms, and promote scientific greening to improve quality, improve standards, and achieve practical results.

In December 2022, the Ecology Environment Bureau of Shenzhen Municipality issued the “Shenzhen Forest Operation Carbon Inclusion Methodology (Trial).”

Source: National Forestry and Grassland Administration, Ecology Environment Bureau of Shenzhen Municipality 

●Cases

The World

Forest Stewardship Council certification

The Forest Stewardship Council (FSC) is committed to improving forest operations around the world and incentivizing forest owners and managers to follow social and environmental best practices through certification.

The increasing demand for FSC certified products has made forest owners realize that business and consumers prefer products from well-managed forests. This incentive approach brings direct benefits to forests, such as the protection of biodiversity, the rights of indigenous peoples and workers, and areas of environmental or cultural significance. The FSC creates a link between forests and end consumers, ensuring that products labeled with the FSC bring the highest benefits to society and the environment.

Source: Forest Stewardship Council

Indonesia’s forest governance program

Image source: FAO

As one of the world’s largest forested countries, any degradation or deforestation of Indonesia's ecosystems will have important impacts locally, nationally, and globally.

Indonesia promotes social forestry, and local communities can obtain the rights to manage their own forests. As of August 2023, the social forestry program provided land rights to state-owned forest land to 1 million households, covering a total area of 5.6 million hectares. Communities use gaps in woodland to grow crops, such as coffee, and use new technology to monitor land use.

The Indonesian government has adopted key new strategies to protect as much of its valuable forest assets as possible, including increasing its Nationally Determined Contribution (NDC) targets to the Paris Agreement on Climate Change and developing new strategies to achieve its FOLU (forestry and other land use) Net Sink 2030 target.

In Indonesia, academics and officials are working together to develop a new system for managing productive forest resources, including more diversified regulation of forest-based industries, such as food, green energy, ecotourism, agroforestry, non-timber forest products (NTFPs) and environmental services such as carbon capture and water storage and filtration. “The main goal is to internalize the goal of protecting natural resources into policy plans and development models of economic sectors for the benefit of humanity. “This new system will aim to ensure that the protection and sustainable use of ecosystems is not only the responsibility of conservation actors, but also the responsibility of all stakeholders, from policy makers to business actors and local communities, even affecting all end consumers in Indonesia and abroad,” said scholars who formulate regulations.

The document explores the various strategic objectives that Indonesia needs to adopt, from formulation to implementation. Four key elements can be summarized:

1. Develop a payment for ecosystem services (PES) plan.

2. Ensure sustainable funding operations to stimulate change.

3. Utilize a Decision Support System (DSS).

4. Promote the value of corporate ESG so that these services are managed appropriately and produce measurable results.

Scholars of this study regard the PES plan as the key to Indonesia’s mandatory promotion of forest ecological conservation. However, so far, the specific implementation of related plans still has room for growth in Indonesia. In addition, private and public funds are crucial to enhance funding certainty. Scholars in the country recommend the continuous optimization and improvement of sustainable financing plan options, including public funds from the government budget, grants and foreign loans, private equity funds, mixed financing, non-public funds in the form of state-owned enterprise (BUMN) funds and funds from charities and non-governmental organizations.

Source: FAO, Taiwan Institute for Sustainable Energy

China

Shenzhen Metro’s green technologies and services

In 2022, Shenzhen Metro Group carried out carbon emissions trading for the first time, and used green technologies such as BIM Forward Design, new energy construction equipment, prefabricated buildings, distributed photovoltaic power generation, energy recycling, energy conservation and consumption reduction. The fourth phase of the subway operation fully implemented unmanned driving technology, and intelligent environmental control systems were fully adopted in project construction. The energy saving rate can be more than 24%, and photovoltaic power generation technology was introduced.

In terms of services, Shenzhen Metro cooperated with Shenzhen Airlines to provide free tickets for citizens and passengers to promote green and low-carbon travel. Shenzhen Metro compiled and released the first “Green and Low-Carbon Development Action Plan” in the rail transit industry.

As for green operations, the total energy consumption in operations in 2022 was 1.57 billion kilowatt hours, a year-on-year decrease of 1.7%, and the annual greenhouse gas emissions were 1.49 million tons of carbon dioxide equivalent. The comprehensive energy consumption of trains per vehicle kilometer was 3.9 kWh/vehicle km, a year-on-year decrease of 4.5%. About 13.46 billion passenger-kilometers of transportation service was provided throughout the year. Based on the fact that each passenger-kilometer of subway travel can reduce emissions by 0.0467 kilograms of carbon dioxide, it was equivalent to reducing the carbon emissions of about 629,000 tons by providing the whole society with low-carbon public travel. The completed photovoltaic projects generated approximately 2.7 million kilowatt hours of electricity in the year, reducing carbon dioxide emissions by approximately 2,500 tons. After the photovoltaic project under construction is completed and put into operation, the annual power generation is expected to exceed 3 million kilowatt-hours and reduce carbon dioxide emissions by approximately 2,800 tons.

Source: Shenzhen Metro Group

Avary Holding’s sustainable development technology applications and models

Image source: Sohu

In 2022, Shenzhen Avary Holding invested 79 million yuan in environmental protection, spent 274 million yuan on the operation of wastewater, exhaust gas, and solid waste. It saved 958,000 tons of water throughout the year. The wastewater reuse rate was 53%, the waste resource utilization rate was 93%, and the energy saving and carbon reduction were 25,035 tons. The company used the Sea Level Rise Map, an assessment tool from the American non-profit news organization Climate Central, to assess sea level rise under different warming scenarios, as well as the topography, altitude, plant and ground differences, and other timing conditions in each industrial park. According to an overall assessment of each operating industrial park, they are all low-risk areas. In order to further stimulate the effectiveness of internal energy conservation and carbon reduction, Avary adopts an internal carbon pricing mechanism, which internalizes the external cost of greenhouse gas emissions. Avary’s industrial park in Shenzhen has launched carbon trading. Considering the conditions of each location, the carbon price in the Guangdong carbon market is used as the company’s internal carbon pricing reference. The price per ton of carbon dioxide equivalent is 70 yuan. When evaluating investment benefits for energy-saving and carbon-reducing projects, internal carbon pricing is used to monetize the environmental benefit value of carbon reduction, which is included in decision-making considerations, thereby assisting the implementation of energy-saving projects and the sustainable development of the company.

The main industrial parks of Avary undergo AWS system audit and certification every year, and conduct water resource risk identification and assessment every year. The World Wildlife Fund (WWF) regional water crisis scoring analysis tool, Water Risk Filter AWS, is used to conduct regional watershed water risk analysis. All industrial parks are of low risk.

The Disclosure Insight Action, known as the Carbon Disclosure Project (CDP), is a non-profit organization that operates a global disclosure system for investors, companies, cities, states and regions to manage their environmental impact. The CDP is viewed as the gold standard for environmental reporting, with the richest and most comprehensive data set on corporate and city actions. The CDP’s water programs empower companies to reveal and reduce their environmental impact by harnessing the power of investors and customers. Avary actively participates in the CDP water safety questionnaire information disclosure through the group. The water safety questionnaire score in 2022 was B, higher than the average level in Asia and the industry.

The Alliance for Water Stewardship (AWS) is a global member cooperative organization composed of enterprises, non-governmental organizations and the public sector. By adopting international water management standards, AWS members understand water challenges in river basins and seek improvement opportunities to address corresponding challenges, including reducing water consumption, improving water utilization efficiency, and reducing the impact of pollution emissions on the environment, so as to contribute to the sustainability of local water resources. In 2022, all Avary industrial parks successfully passed the audit, and the AWS certification level continued to be platinum.

Source: Avary Holding

●Background

Sustainable Development Goals (SDGs) initiated by the United Nations

On January 1, 2016, the 17 Sustainable Development Goals (SDGs), including 169 targets, of the 2030 Agenda for Sustainable Development — adopted by world leaders in September 2015 at an historic UN Summit — officially came into force. Countries will mobilize efforts to end all forms of poverty, fight inequalities and tackle climate change while ensuring that no one is left behind.