Opinion

Governing sustainable forest

management in the new climate
regime
Frances Seymour1 and Elizabeth Forwand2
The newly appreciated role of deforestation and forest degradation as globally
significant sources of carbon emissions has focused fresh political attention and
large prospective financial flows on tropical forest management. Negotiations at the
Thirteenth Conference of the Parties of the United Nations Framework Convention
on Climate Change produced a road map toward including compensation
to tropical countries for reducing emissions from deforestation and forest
degradation (REDD) in a future global climate agreement. The prospect of a global
REDD mechanism has spurred the development of REDD initiatives by national
governments, international organizations, and private actors. These new initiatives
are facing many of the same forest governance challenges that have stymied past
efforts to improve the conservation and management of tropical forests. To be
effective, efficient, and equitable, REDD efforts will not only have to reverse the
economic incentives that drive forest loss, but will also need to clarify land tenure,
link to international efforts to curb illegal logging and trade, and manage trade-offs
among competing objectives. They will also need to strengthen the institutional
capacity for inclusive REDD design processes, transparent monitoring of carbon
emissions and financial flows, and cross-sectoral and cross-scale coordination. At
the same time, REDD initiatives could provide opportunities to accelerate the
required forest governance reforms. 2010 John Wiley & Sons, Ltd. WIREs Clim Change 2010
1 803810 DOI: 10.1002/wcc.70

INTRODUCTION

ew understanding of the two-way linkages

between forests and climate change has brought
forests back to the center of the international
political stage for the first time since the Rio Earth
Summit in 1992. The Intergovernmental Panel on
Climate Change has clarified that land use change,
primarily deforestation in developing countries, is
responsible for approximately one-fifth of current
carbon emissionsa greater percentage than the
entire global transport sector.1 The Stern Review2
asserted that avoiding deforestation is among the
most cost-efficient means of reducing emissions,
and as such must be a key element of any
Correspondence

to: f.seymour@cgiar.org

Center for International Forestry Research, Jalan CIFOR, Situ

Gede, Bogor Barat, Indonesia

2 Scientific

Certification Systems, Legal Harvest Verification Sevices,

Emeryville, CA, USA
DOI: 10.1002/wcc.70

Vo lu me 1, No vember/December 2010

future climate protection regime. Negotiations at the

Thirteenth Conference of the Parties of the United
Nations Framework Convention on Climate change
(UNFCCC) encouraged parties to forge ahead with
reducing emissions from deforestation and forest
degradation (REDD) demonstration activities and
produced the Bali Action Plan toward including forests
in a new emissions reduction agreement.3 REDDplus, the term used in the Copenhagen Accord,
connotes inclusion of activities to enhance forest
carbon stocks.4
These developments have encouraged the flowering of public and private REDD initiatives at
local, national, and global levels. In Aceh, Indonesia, the Governors office and an investment bank
announced a $9 million deal to protect forest carbon
at the landscape level.5 The Government of Brazil
established the Amazon Fund as a national-level vehicle for REDD finance and received a $100 million
down payment on up to $1 billion promised by
the Government of Norway.6 Three United Nations

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agencies established a new UN-REDD Program to

assist countries in preparing for REDD, while the
World Bank is developing a Forest Investment Program to finance implementation. The Eliasch Review7
found that a global carbon market could generate
$7 billion dollars a year by 2020. Despite receiving less
attention than REDD in the global discourse, forests
also have a significant role to play in adaptation to
climate change8 and arguably should feature prominently in national adaptation strategies and associated
international finance.
The sudden lavishing of attention and finance on
forests raises many questions about how forests will be
governed in emerging regimes at national and global
levels to mitigate and adapt to a changing climate. In
many ways, these developments present new opportunities to address old challenges in forest governance,
but pose new challenges as well. Will the new focus
on forests resolve or exacerbate long-standing debates
about what constitutes sustainable forest management? Will the threat of climate change succeed in
marshaling the political will and finance necessary to
leverage changes in the political economy of forest
management that have stymied previous attempts at
reform?

WHY DO FORESTS MATTER?

Forests are critical to the daily survival of hundreds
of millions of people. The World Bank estimates that
globally over one billion people rely on forests for
some part of their livelihood, including basic food and
shelter,9 with the worlds extreme poor disproportionately represented. For example, the dry forests of
sub-Saharan Africa cover over 40% of the continent
and are inhabited by nearly 236 million people,10 the
majority of whom are below the poverty line. Over
two billion people, a third of the worlds population, depend on biomass fuels, mainly firewood, for
their primary source of energy, and billions rely on
traditional medicines harvested from forests.11
Forest products are economically important at
global and national scales as well as at the household level. In 2003, the international trade in sawn
wood, pulp, paper, and boards amounted to almost
US $150 billion, or just over 2% of the world trade.9
International trade in non-timber forest products is
substantial, with products such as nuts, cork, pharmaceuticals, charcoal, and honey worth an estimated
US $11 billion.9 A recent study of forest-dwelling
communities in Cameroon found that non-wood forest products provided by far the largest contribution
to household income, accounting for more than 40%
of household income on average.12
804

Forest ecosystem services are valuable locally,

nationally, and globally. Forests maintain watershed
services, regulating water quality and local hydrology,
including flooding and erosion.13 Native forest
vegetation also serves to maintain and revive soil
fertility. Forest ecosystems sustain biological diversity
and remain an important source of cultural heritage
and self-sufficiency for many of the worlds forestdwelling people.14 In East Kalimantan, Indonesia,
local communities identify more than 2100 forest
species with 3642 different uses, including food,
medicine, hunting, construction, and ornamentation.
One hundred and nineteen of these species have no
known substitute for the particular use.15
Forests now matter even more because of their
newly appreciated roles in climate mitigation and
adaptation. This new appreciation represents nothing
short of a revaluing of the worlds forest resources and
the services they provide to the global community as
well as to local stakeholders. Forests hold the majority
of the earths terrestrial carbon storesapproximately
80% of all carbon stored in vegetation, and almost
40% of soil carbon is contained in forests.16 The
significance of forests as a share of potential emissions
reductions is stark for many countries; 75% of
Southeast Asias Greenhouse Gas (GHS) emissions
in 2000 were from land use change alone.17

CHALLENGES IN GOVERNING
TROPICAL FOREST MANAGEMENT
New forest-related initiatives stimulated by the threat
of catastrophic climate change have the potential to
shapeand risk being shaped bythe existing political economy of the management of forest resources.
Such initiatives are being superimposed on forest governance regimes at national and international levels
that are already fraught with a number of challenges
which are summarized below.

Challenges at the National Level

National-level forest governance regimes in tropical
countries in many cases date from the colonial era,
and privilege the role of the state in forest management. With few exceptions, such regimes have
proven inadequate to address the direct drivers and
underlying causes of deforestation and forest degradation. Decades of international assistance has not
been able to reverse negative trends,18 and high rates
of deforestation and degradation have for the most
part continued apace.19 These trends are the result of
economic drivers, exacerbated by policy, market, and
governance failures.

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Governing sustainable forest management in the new climate regime

At the most fundamental level, unsustainable

forest exploitation and conversion of forest land
to other uses are economically driven. More than
a decade of research on the underlying causes of
deforestation has shown that forest conversion to
agriculture is usually, though not always, rational
for individual economic actors. Be it through largescale commercial farming and ranching in the Amazon
region, agrofuel development in Southeast Asia or
small-scale farmers in Congo Basin countries, all generate greater financial returns per hectare from land
uses other than forest.20,21 For REDD schemes to be
successful, they will need to provide a convincing economic alternative to forest conversion, and will have
to be coordinated across multiple sectors.22
Policy failures have often led to forest loss even
beyond levels that would be economically rational. For
example, tax incentives for land clearing have been a
driver of deforestation in the Amazon23 ; subsidies
to forest industry have supported excessive harvest
and forest conversion in Indonesia.24 Market failures
have also contributed to deforestation and degradation. Until recently, markets did not exist to capture
and compensate forest landowners for the value of
forest-based ecosystem services. Nascent Payments
for Ecosystems Services schemes have shown some
promise in capturing the value of hydrological services and landscape amenity values,25 and REDD
schemes are expected to build on these models to
capture the value of carbon sequestration. However,
markets remain undeveloped for biological diversity
conservation.
Characteristics of the forestry sector render
it particularly prone to governance failures at the
national level. The high value of timber and other forest products provides opportunities for rent-seeking
behavior on the part of state and corporate actors.
Non-transparent decision making regarding the use
of forest resources provides opportunities for corruption at all levels. Remaining forests tend to be in
areas that are remote from government institutions
and populated by communities that are poor and
members of minority ethnic groups. Unclear and contested resource rights and tenure over forestoften
resulting from the overlay of customary, colonial, and
post-colonial land rights regimesmake forest-based
communities vulnerable to alienation from lands over
which they have traditionally exercised stewardship.
In many countries with significant remaining natural forest cover, the political economy
of forest management involves complex and often
competing social, political, and economic interests.
Weak forest governance structures include inappropriate forest law, weak law enforcement capacity,
Vo lu me 1, No vember/December 2010

and perverse incentives.22 Such conditions do not

generally engender forest conservation, but instead
reward actors able to exploit governance failures to
gain political or economic advantages. Strengthening
regulatory frameworks and creating appropriate
incentive structures in these situations are difficult precisely because of the political economy currently favoring unsustainable resource exploitation.26 Nationallevel institutional and regulatory frameworks that
govern access to and management of forest resources
are often systematically biased against the interests of
rural communities.27
A key factor confounding good forest governance is that most drivers of tropical deforestation
originate outside the traditional forestry sector. In
general, tropical deforestation is due to an increasing demand for land, not an increasing demand for
timber. Agriculture expansion, plantations for agrofuels such as palm oil, and infrastructure development,
such as road building and mining, contribute more
to deforestation than does logging.2022 The role of
such drivers will likely become more complex as
livelihoods and biodiversity are affected by climate
change28 and traditional forest sector management
responses become even less effective in stemming
deforestation. Although many socioeconomic sectors
(e.g., hydropower and drinking water) are highly vulnerable to climate change and dependent on forest
goods and services,8,29 most countries lack institutions
to make linkages across such inter-sectoral interests.

Challenges at the International Level

National-level efforts to improve forest management
are influenced by factors beyond national borders.
These factors include globalized trade and investment
in forest products, such as timber, pulp, and paper, and
in commodities that drive forest conversion, including
beef, soya, and palm oil. However, international
efforts to improve the conservation and management
of tropical forestsand to govern the transnational
trade and investment flows that affect forests in
particularhave been constrained by the lack of a
clear international forestry regime well articulated to
other international regimes.
An underlying obstacle to agreement on international governance of the transnational timber industry
is the lack of consensus on basic forest management
concepts and objectives. The prospect of REDD
and the possibility of rewarding timber companies
for reducing the impact of logging activitieshas
breathed new life into debates about how to define
sustainable forest management (SFM). In particular,
there is controversy regarding how the SFM concept
should be applied to primary forests being considered

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for timber extraction. The United Nations recognition

of SFM as a dynamic and evolving concept. . .
intended to maintain and enhance the economic, social
and environmental value of all types of forests, for the
benefit of present and future generations30 does not
provide sufficient guidance to resolve such debates. As
a result, different stakeholder perspectives on the issue
will have to be resolved in the context of formulating
REDD policies.
A second challenge is posed by international
trade and investment policy regimes that curtail
options for international cooperation on forestry,
especially efforts to address trade in illegally felled
timber. Although there are examples of effective
market-based initiatives that have arisen to meet the
failings of public institutions (e.g., forest certification),
continued reliance on market-based initiatives allows
corporate interests undue influence over what should
be the realm of publicly accountable institutions, and
effectively privatizes governance.31 A challenge under
REDD will be improving the ability of existing international bodies to regulate private economic activity
related to forests and creating the new institutions
necessary to do so.
A third challenge is that REDD initiatives are
being developed largely in parallel to, rather than
in coordination with, efforts to improve the legality
of the international timber trade through voluntary,
bilateral agreements. The lack of integration of REDD
with the so-called Forest Law Enforcement, Governance, and Trade (FLEGT) initiatives is unfortunate,
as there are both direct and indirect synergies to be
exploited. For example, the efforts of both FLEGT
and REDD initiatives would be served by greater clarity regarding forest rights and tenure. Both programs
also face similar challenges in setting up monitoring
and verification systems for traded commoditiesin
one case timber, in the other, (prospectively) carbon
offsets.
Clearly, a significant body of knowledge already
exists to explain why previous efforts to halt
deforestation and degradation have failed, largely due
to governance failures at national and international
levels. The prospect of REDD underlines the need
for new research to understand whether and how
the unique features of REDDsuch as investments
in readiness and performance-based paymentscan
overcome those barriers.

REDD MECHANISMS AND

INSTITUTIONAL CAPACITY
The degree to which technical and institutional
capacity is developed in forest countries will determine
806

the effectiveness, efficiency, and equity of the design

and implementation of any future REDD mechanism
under the UNFCCC. In many countries, significant
investments in capacity building will be required for
successful outcomes.
Technical capacity deficiencies, particularly
those related to forest carbon assessment and emissions monitoring, have received significant attention
in early discussions of REDD readiness needs. Much
progress has been made in refining monitoring, reporting, and verification (MRV) methods since REDD
negotiations began. However, access to reliable data
on forest cover and condition is still a problem in
many countries, compounded by capacity deficits that
limit consistent and transparent data collection and
analysis.32 In many countries, credible REDD programs will require that relevant personnel be trained
in the latest methods in forest carbon accounting
and remote sensing. Particular environments, such
as mountain ecosystems, will pose special technical
capacity challenges, requiring additional technological support. Technology transfer from industrial
countries to developing countries will be a necessary
complement to capacity building.16
Less attention has been given to the institutional capacity required to formulate and implement
REDD policies and associated financial transfers. Such
capacity is not yet in place in many of the high
deforestation developing countries already embarking on REDD demonstration activities. Indeed, for
all the technical obstacles that REDD presents, meeting institutional capacity needs may prove the greater
challenge. REDD revenue management will have to
comply with international standards of financial transparency and accountability. The need for common
MRV standards in REDD financial accounting is as
pressing as the need for integrity in accounting for carbon emissions avoided.33 Also, with one of the most
important forest governance trends in the 21st century
being the decentralization of forest management,28
the capacity-building agenda for REDD must include
a substantial component targeted at sub-national
institutions.
Capacity for inter-sectoral collaboration and
coordination of multi-sectoral responses to climate
change is currently lacking at all levels. Yet changes
in policies and practices beyond those of ministries of
forestry will be essential if national REDD strategies
are to tackle drivers of deforestation that originate
outside the forestry sector.34 It is possible that new
REDD-specific institutions will have to be created
to achieve such collaboration. As discussed below,
differential capacity among stakeholders to represent
their own interests in REDD discussions remains a

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significant challenge in designing equitable REDD

mechanisms at national and global levels.

on the effectiveness of REDD in reducing emissions

and on the actual distribution of benefits is needed to
provide evidence to inform these debates.

HOW WILL IT BE LEGITIMATE AND

EQUITABLE?

MANAGING RISKS AND TRADE-OFFS

The legitimacy of REDD efforts will depend in large

part on the perceived procedural integrity of REDD
design processes at global, national, and local levels. Capacity disparities between countries and among
stakeholders to negotiate their interests in the REDD
design process may translate into inequitable outcomes later on. At the international scale, different
countries have different interests in such questions as
the scope, scale, and financing of REDD,35 but are
not equally endowed with the capacity to develop and
negotiate their positions. In the context of national
implementation, populations that stand to be the most
affected by REDD policies (forest-dwelling communities, indigenous peoples, and forest-dependent populations) are those who often have the least capacity to
make their voices heard. If REDD design processes and
outcomes are perceived to be inequitable, the political
legitimacy of policies and projects will be at risk.
The legitimacy of REDD is also threatened by
perceptions that REDD rewards the bad guys. At the
international level, REDD has been opposed by groups
who see it as a vehicle for industrialized countries
to off-load their emissions reduction responsibilities
onto developing countries through offset mechanisms.
There are also concerns that if REDD is financed
through global carbon markets, market intermediaries
rather than poor countries and communities will
capture most of the benefits. At the national level,
there are concerns that REDD payments will at worst
provide incentives to powerful elites to push forest
peoples off their lands, and at best be directed to those
responsible for destroying the forest, rather than to
those who have been exercising good stewardship.36
There are likely to be trade-offs between efficiency and equity in the allocation of scarce REDD
resources. For some governments, the potential of
REDD to finance co-benefits such as rural poverty
reduction is a prime motivator for participation in
a global REDD regime. For other stakeholders, the
potential of REDD to promote biodiversity conservation is a primary objective. But the geographic
targeting for maximum carbon emissions reduction,
maximum poverty reduction, and maximum biodiversity conservation will not be the same. International
negotiations and political processes at the national
level will determine how those trade-offs are made.
As the first generation of national REDD policies and
site-specific REDD projects gets underway, research

The primary purpose of new initiatives to link

forest management to climate change mitigation and
adaptation is to reduce the risk of catastrophic
climate change. Accordingly, the risks inherent in
these initiatives must be balanced against the risks
of no action. An important risk is that the potential
of forests to be part of the solution could be lost if
overall emissions leading to global warming are not
reduced in the near term. A warmer, drier climate
could lead to a positive feedback loop in which more
frequent droughts and emissions-intensive forest fires
could accelerate climate change while reducing forests
ability to sequester carbon.37 Some models suggest
that the carbon-rich forests of the Amazon could be
replaced by carbon-poor Savannah ecosystems in such
a scenario.38 Thus the future potential of forests as
a climate mitigation option depends on how quickly
the international community acts to reduce emissions
from all sources, including forests.
The risks of no action also include the risk of failing to capitalize on the opportunity to accelerate forest
governance reforms offered by REDD-related political attention and finance.39 For example, increased
international scrutiny associated with REDD mechanisms could lead to more disclosure of forest-related
data and increased transparency in forest-related
finance. REDD readiness activities could include the
strengthening of the forest-related rights and tenure
of indigenous communities.
However, the downside risks of harnessing
forests for climate objectives are real, and governance
mechanisms are needed to identify such risks, manage
trade-offs with potential benefits, and undertake
appropriate mitigation measures. Poorly designed
REDD schemes risk perpetuating existing inequities in
forest governance and further disenfranchising forestdependent communities.40
Indigenous people and local communities are at
disproportionate risk of having their rights and livelihoods compromised by REDD policies and projects,
especially in light of unclear and contested resource
tenure in many forest areas. The availability of new
income streams associated with forest management
could provide incentives for more powerful state
or corporate actors or local elites to ignore or
deny the claims of such communities for access to
forest resources and a fair share of REDD benefits. The last decade has seen a modest transition

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away from forest land administered by national

governments toward increased ownership by individuals and communities,41 but there is a risk that
REDD could slow down rather than accelerate such
reform.42
REDD could pose risks to human rights, including the possible violation of the economic, social,
and cultural rights of indigenous and local communities, and infringements on procedural rights related
to their representation in decision-making forums.40
Explicit protection for local rights and livelihoods
should be included in REDD as an ethical imperative,
and REDD proponents should also recognize that the
voluntary cooperation of people living in or adjacent
to forests is likely to be necessary for overall program
effectiveness. International human rights law provides
guidance on what rights must be protected and what
procedures put in place to protect the rights of local
people.43
In addition, multilateral development banks
have safeguard policies, and international development donors have procedural requirements that can
inform norms for future REDD protocols.42 Implementation of safeguard policies originally designed
to identify social and environmental risks can also
yield governance benefits, by providing one of the
few opportunities for affected communities and the
broader public to learn about proposed initiatives.44
However, the utility of such safeguards and the manner in which they should be appliedincluding by
whom and at what stage in project development
continue to be contested among international donors,
recipient governments, and civil society organizations.
As a result, REDD-specific safeguards and procedural
standards will have to be negotiated.
Risk management itself entails trade-offs. For
example, there is a risk of incorporating too many
safeguard protocols and ever more complicated policy
mechanisms, which could slow down implementation and discourage investment in REDD efforts.42
Forest carbon monitoring entails trade-offs in cost versus accuracy, as more precise monitoring and carbon
accounting techniques necessitate more person hours
and sophisticated equipment, at increasing cost.32

The potentially high transaction costs of integrating community-based forest management into REDD
schemes could force trade-offs between a larger number of beneficiaries and efficiency. Ultimately, REDD
policies may entail some sacrifice in carbon emissions
reduction to achieve broader development goals, a
trade-off between climate effectiveness and delivery of
co-benefits. Research is needed to further illuminate
these trade-offs, and perhaps even begin to quantify
them.

CONCLUSION
Economic drivers of deforestation and degradation
combine with weak governance to create a political economy that does not favor conservation of the
worlds tropical forests. New appreciation of the role
of forests in climate mitigation and adaptation has the
potential to mobilize new constituencies and sources
of finance for managing forests in more sustainable
ways, with important co-benefits for biodiversity and
rural livelihoods.
At the same time, that potential brings into
high relief the inadequacy of current forest-related
institutions and governance mechanisms at all levels.
For REDD to be effective, efficient, and equitable,
forest-related property rights must be clarified, policy and planning must be coordinated across sectors,
and policy incoherence across global economic and
environmental regimes must be overcome. Governments will need to develop new capacities for forest
monitoring, stakeholder consultation, and transparent
financial management.
The governance challenges faced by new REDD
mechanisms are immense, but the risks of no action to
mitigate forest-based emissions are similarly large.
Accordingly, there is an urgent need for applied
research to accompany the first generation of REDD
initiatives. Such research could illuminate how REDD
proponents can optimize among competing objectives
and manage risks so as to protect vulnerable forestrelated stakeholders while also contributing to efforts
to protect the planet from catastrophic climate change.

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