Benxi
Pulp and Paper

Globally, only four commodities drive the majority of deforestation: palm oil, soy, beef and wood products. The pulp and paper sector is one of the major wood products and risks contributing to tropical deforestation and other adverse impacts. The sector also has opportunities to develop more sustainable business models and production systems. Aidenvironment conducts analysis of the major sustainability risks and opportunities in Indonesia’s pulp and paper sector in order to contribute to the transformation of the sector.

About Indonesia’s Pulp & Paper Sector

Indonesia is a top 10 global producer of pulp and paper. The raw material for this industry primarily comes from industrial tree plantations (hutan tanaman industry or HTI). Industrial tree plantations are the second largest plantation sector in Indonesia after oil palm and cover more than 10 million hectares of land in Indonesia. Industrially grown trees are not only used for the production of pulp and paper, but also for timber products and energy generation.

Indonesia’s pulp and paper sector faces a number of sustainability challenges. These include deforestation, the degradation of peatland ecosystems and land conflicts with communities. Whereas deforestation rates in Indonesia have dropped markedly in recent years, the pulp and paper sector has not seen a transformation towards a No Deforestation, No Peatland, No Exploitation (NDPE) industry. Sustainability risks may turn into financially material business risks.

The Companies That Can Drive Transformation

The Indonesian pulp and paper sector is dominated by a handful of large and influential corporate actors. These are vertically integrated actors that operate industrial tree plantations, pulp mills and paper factories. They also have substantial influence over their suppliers. At the same time, a number of other industrial tree plantation owners operate in markets outside of the pulp and paper sector. Aidenvironment investigates and monitors a set of the most influential companies that either have leverage to change the sector, and/or that face particularly salient sustainability risks.

Our Project

Aidenvironment has started a project to promote pulp and paper sector transformation by

  1. 1) creating near-real time transparency on deforestation, corporate ownership and supply chain relations;
    2) introduce business risk concepts to enhance strategic engagement with influential stakeholders;
    3) call for cross-commodity implementation of NDPE policies of palm oil traders; and
    4) develop influencing strategies that target key pulp and paper companies.

The project “Corporate Transformation in Indonesia’s Pulp and Paper Sector” is supported by the Good Energies Foundation.

Sign up for Aidenvironment’s Pulp & Paper Newsletter

Sign up for Aidenvironment’s Pulp & Paper Newsletter

 Publications

News and Insights

Call for Partnerships

Please reach out to us if you are interested in:

  • increasing awareness of deforestation and the environmental impact of pulp and paper production
  • joint engagement of pulp and paper companies
  • knowledge exchange and data sharing on the pulp and paper sector
  • exploring other pathways to accelerate the sustainable transformation of the pulp and paper sector

Email us

Learn more about our work

Contact expert Tim Steinweg

Contact expert Chris Wiggs