PROGRESS REPORTSUSTAINABLE FOREST MANAGEMENT FORESTAL ARAUCO S.A.

Gestión sustentable

FSC (FOREST STEWARDSHIP COUNCIL)FSC (FOREST STEWARDSHIP COUNCIL)FOREST MANAGEMENT CERTIFICATION PROCESSFOREST MANAGEMENT CERTIFICATION PROCESS

Sustainable management

Market Communication :Sustainability Certification / Responsible Management

Certifications

TRACK RECORD IN THE ENVIRONMENTAL, SSO AND SUSTAINABLE FOREST MANAGEMENT

OHSAS

18.001

1998 Signing of

Values CORMA

2003 Agreement signed with

NGOs2001 ISO 14001

Sustainable Forest

Management

Track record

Standards: CERTFOR

9 Principles

54 Criteria

193 Indicators

FSC10 Principles

56 Critera

215 Indicators

Standards: FSC

OUTLINE OF PROCESS FORFOREST MANAGEMENT CERTIFICATION

1. Application2. Pre-audit

3. Establishment of Evaluation Team4. Public consultation of stakeholders5. Preparation: review of documentation6. Main evaluation7. Review (independent) and decision8. Certification

9. Follow-up Audit (annual)

Pre-Audit

Main Audit

Follow-up

SELECTION OF CERTIFICATION ENTITY

(WOODMARK)

SELECTION OF CERTIFICATION ENTITY

(WOODMARK)

PHASE ONE

7-15 SEP

PHASE ONE

7-15 SEP

PHASE TWO

26 OCT – 8 NOV

PHASE TWO

26 OCT – 8 NOV

• International Audit team and local experts

• Stakeholders’ interviews (42)

• Operations/sites visits (25) (Constitución, Chillán, Concepción, Arauco, Collipulli, Temuco, Valdivia)

• FSC Chile-Woodmark Meeting

• Weaknesses detected in the stakeholder consultation phase and deadline for completion is extended.

• Organization and implementation of phase two of pre-audit

• 137 stakeholders interviewed

FSC PRE-AUDIT 2009

Stakeholders Interviews

Provinces Interviews

Talca 4

Linares 1

Cauquenes 8

Ñuble 10

Concepción 17

Bio Bio 3

Arauco 20

Malleco 16

Cautín 11

Valdivia 46

Ranco 1

137

88

1717

4646

2020

44

11

11

1111

1616

33

1010

Stakeholder Consultation

FSC PRE-EVALUATION OF FORESTAL ARAUCO S.A., 2009Undertaken by Woodmark, Soil Association between 7 September and 8 November 2009

SUMMARY OF FINDINGS• Arauco has a very high and efficient technical

standards.

• Stakeholders are focused on social and environmental issues.

• Stakeholders do not differentiate between forest management and industrial operations (Cellulose).

• Many perceptions are based on past activities of the last 25 years.

FSC PRE-EVALUATION OF FORESTAL ARAUCO S.A., 2009Undertaken by Woodmark, Soil Association between 7 September and 8 November 2009

FSC PRE-EVALUATION OF FORESTAL ARAUCO S.A., 2009

SUMMARY OF FINDINGS

KEY ISSUES TO DEAL WITH:

• Commitment with the community

• Native Forest Conversion/Restoration

• Landscape-Scale Planning and Design

Undertaken by Woodmark, Soil Association between 7 September and 8 November 2009

Woodmark’s checklist has a total of 293 indicators

Pre-Audit Final Report raised “findings” for 82 indicators (28%)

In a Main Audit, these “findings“ could be:

- "Preconditions"

- "Conditions“

- "Recommendations"

FSC PRE-EVALUATION OF FORESTAL ARAUCO S.A., 2009Undertaken by Woodmark, Soil Association between 7 September and 8 November 2009

Results

RELEVANT ISSUES Final Report

Findings CARs

1 Labor 3 1

2Consultation, Participation, Conflicts 9 7

3Indigenous Communities 11 10

4Social Impact Assessment 4 4

5Public information, Management Plan 8 5

6Contribution to local economies 2 1

7Replacement of Native Forest 2 1

8High Conservation Value Forests (BAVC) 3 3

9Landscape scale Management 9 10

10Soil and Water Management (Road Standards) 6 6

11Use of Chemical Products 3 2

12MFS Monitoring Systems and SGI Documentation 6 7

13Operational best practice (field) 16 11

82 68

A goal that was set: cross-board responsibility

Taking on a series of baseline criteria to deal with the process

F 1

F 2

F 3

F N

P1

P3

P2

The model: hybrid forums

BASE FORUMACTIVATION & METHODOLOGY

DEPLOYMENT OF FSC CONTROVERSIES

DIALOGUE

MAP OF CONTROVERSIES

Experts

StakeholdersCommunities

Actors internal and external

to the company

Results

RELEVANT ISSUES Final Report

Findings CARs

1 Labor 3 1

2Consultation, Participation, Conflicts 9 7

3Indigenous Communities 11 10

4Social Impact Assessment 4 4

5Public information, Management Plan 8 5

6Contribution to local economies 2 1

7Replacement of Native Forest 2 1

8Forests with High Conservation Value (BAVC) 3 3

9Landscape scale Management 9 10

10Soil and Water Management (Road Standards) 6 6

11Use of Chemical Products 3 2

12MFS Monitoring Systems and SGI Documentation 6 7

13Operational best practice (field) 16 11

82 68

WORK TEAMS FSC ISSUES

8 to 12 people

to be defined

Proposal of Thematic Forums (FH)

1 Labor (ILO Conventions 87 and 98)

2 Indigenous Communities

3 Socioeconomic Contribution to the Local Economy

4 Replacement of Native Forest(Nov 1994)

5 High Conservation Value Forests (BAVC) [ + wetlands ]

6 Landscape scale (size of stands, water, soil, esthetics…)

7 Soil and water management

FORUM MEMBERSEXPERTS

NON-EXPERTS

AFFECTED PARTIES

ENVIRONMENTAL

SOCIAL

ECONOMIC

FCEL

BASA

FVAL

FASA

BioforestARAUCO Corp

FSC BOARDCOMMITTEE

FOREST MANAGERS’ COMMITTEE

PROJECT’S EXECUTIVE SECRETARIAT

EXECUTIVE COMMITTEE

BASE FORUM

THEMATIC FORUMS (7)

TECHNICAL TEAMS (7)

211 Indicators without findings

IMPLEMENTATION TEAMS

TECHNICAL TEAMS (6)

16Indicators with

findings for direct implementation

30Indicators with

findings of a technical nature.

36Indicators with findings

of a socio-technical nature (controversies)

FSC PROJECT ORGANIZATIONAL STRUCTURE

A “brand” for the process:

Communication

Communication and information platforms

Informative Bulletins

Communication

Thank you…