Forest Stewardship Council - FSC As Market-Driven Environmental Governance

FSC As Market-Driven Environmental Governance

Because it works outside of state regulations, some academics have classified FSC as an example of a non-state market driven (NSMD) form of environmental governance. This means that it uses the market to drive the sustainable management of forests. As Cashore (2002) observes the FSC network does not have the political authority of a traditional nation state and no one can be fined or imprisoned for failing to comply with its regulations. In addition, governments are forbidden from being members of the FSC and their only engagement with FSC is as land owners. The authority of the FSC is determined by the approval of external audiences, such as environmental NGOs.

The FSC Label is an example of the use of public purchasing power to create shifts in industry and regulate the negative environmental impacts of deforestation. The FSC Label ‘works’ by providing an incentive for responsible forestry in the market place. It offers manufacturers a competitive advantage and thereby increases market access to new markets and maintains access to existing ones.

Non-state market-driven methods are often used because of allegations of ‘state failure’ in managing the environment. In the neoliberal view, market based methods are seen as one of the most effective and efficient ways to meet environmental goals. The market is seen as the key mechanism for producing the maximum social good and governance networks are seen as the most efficient way to regulate environmental concerns.

The FSC transnational NGO network demonstrates theories of global governance, more specifically in governance network theory. FSC is an example of how network governance can create change in industry and encourage organizations to improve the sustainability of industrial forestry practices. As Bäckstrand (2008) states, the FSC governance network brings together private companies, organizations and civil society in a non-hierarchical fashion, to voluntarily address certain goals. According to governance network theory, actors in the network are dependent on each other and collaborate to reach specific goals, through exchanging information or resources.

Through the chamber system, governance of FSC has checks at local, national and international levels which mean that it includes interests regardless of their geographical location. This gives FSC some advantages over state governance systems. In theory, as a governance network, FSC members share knowledge, environmental goals and knowledge of what those goads entail. This means that they coordinate effectively, improving the process and outcomes of the environmental policies they pursue. Moreover, knowledge sharing and collaboration enables the FSC network to deal with complex and interrelated issues.

Some critiques however suggest that network governance does not always work this way. Network governance theory suggests that partnerships should be equal, but inequalities of power within networks can result in hierarchical relationships determined by more dominant actors. Within FSC, lareger international actors may have a stronger influence than smaller stakeholders, meaning that the FSC governance network may not represent all participants fairly. FSC has instituted the chamber system to try and tackle this imbalance.

Furthermore, actors in networks operate as representatives of certain groups but also as individuals with their own agendas and values, and members in the FSC network are usually motivated by pragmatic rather than moral considerations. Moreover, Sorenson and Torfing (2005) argue that for governance networks to achieve their goals they should be controlled by democratically elected politicians. Although formerly there were no elections in the FSC governance system, reforms mean that the Board of Directors is now democratically elected by the membership chambers.