Sustainable Forest Finance Toolkit - PwC

Suggested Internal Bank ForestryPolicy and Guidelines1 of 4Policy Dev HOMEComponent Description of Component Content Options Reflecting Good PracticeRelevance to thebankContext and issuesScope of policyProvide an indication of the typesof business activities andsubsectors with which the bank iscurrently involvedA description of the nature ofenvironmental and social issuesin the forestry sector, and thecontext within which it operatesglobally, e.g. forthcomingregulation etcAn explanation of which parts ofthe bank’s operations the policyapplies, which sub-sectors, andwhether the policy also includesdownstream business activitiesIt is advisable to provide a brief description of the sector’s relevance to the bank, including the extent of the bank’s current involvement, for instancesub-sectors and nature of activities, e.g. forestry (plantations), forestry products (timber, palm oil, biofuels) and pulp/paper. The policy should stateclearly if there are any activities to which the bank is not exposed, e.g. pulp and paper. Also, if known, any forward-looking statements regarding thebank’s involvement in the sector could be included, as well as any forthcoming policy developments on related issues (e.g. biofuels, climate change etc)Policies may also need to cross reference each other, e.g. where timber is part of the supply chain for furniture manufacturers; how the biofuels policyreflects the climate change policy.The bank could outline where it sees opportunities for future engagement with the sector, e.g. new financing mechanisms such as forest bonds, andhow it plans to capture such opportunities.The bank could consider providing:• an outline of the sector-specific environmental and social issues, e.g. illegal logging, impacts of palm oil, biodiversity loss/destruction• an outline of the cross-cutting environmental and social issues, e.g. impacts on indigenous peoples dependent on forests, bribery and corruption,links to climate change• a description of any relevant regulatory developments, e.g. EU Biofuels directive• an explanation of how this policy links to the bank’s overall policy framework, and to other sector/issues policies and industry initiatives, includingthose to which they are party. For example, explain linkages to:• Equator Principles – IFC Performance Standards, e.g. biodiversity, indigenous peoples• Other relevant Sector Policies – Energy, Agriculture• Other relevant Issues Policies – Climate change, Human rights• If appropriate, reference could also be made with regard to the bank’s approach to high-risk countries, and how this links to the implementation ofthe Forestry Policy.A best-practice approach would be for the policy to be all-encompassing and therefore to include:• all lending activities and other forms of financial assistance,• debt and equity capital markets activities,• asset management,• trade finance, and• advisory work.Page 74pwc