Hans Nicholas Jong, Jakarta – A major global forestry certification body is under scrutiny for endorsing one of Indonesia's largest recent deforesters, raising concerns that consumers may be misled about the origins of the wood products they buy.
In November, the Programme for the Endorsement of Forest Certification (PEFC) approved the certification of Indonesian timber firm PT Industrial Forest Plantation (IFP). The label allows the company to market its pulpwood as "sustainable," even though investigative group Earthsight says IFP has in recent years become Indonesia's second-largest deforester.
Between 2016 and 2022, IFP cleared nearly 22,000 hectares (about 54,000 acres) of natural forest in central Borneo, an area roughly the size of Amsterdam, to establish its plantations. Since 2022, the company has cleared more forest each year than almost any other operator in Indonesia's industrial plantation sector. The concession lies in a landscape recognized as a key stronghold for critically endangered Bornean orangutans (Pongo pygmaeus), with roughly half the licensed area estimated to be orangutan habitat.
IFP has refuted Earthsight's findings, saying all clearing and planting was carried out under work plans approved by Indonesia's Ministry of Environment and Forestry. It also said it stopped logging natural forest at the end of 2023. But analysis by Indonesian NGO Auriga Nusantara shows deforestation continued well into 2024, with more than 1,000 hectares (2,500 acres) of forest loss recorded in the concession. That made IFP the fourth-largest deforester among plantation permit holders that year.
PEFC told Earthsight it found no clear evidence of procedural error in the certification. It added that if credible information emerges showing deforestation that violated the standards, it could initiate a formal complaint to IFP's auditor, Mutu International, which would then be required to investigate.
Earthsight's latest report says the risk extends beyond Indonesia.
The report traced timber supply chains from Indonesian mills that processed wood from recently cleared forests, including sources linked to IFP, and found that these mills exported more than 23,000 cubic meters (812,200 cubic feet) of wood products to the European Union in 2024, mostly to Belgium, the Netherlands and Germany.
The report says there's a high risk that timber imported by European companies originates from forest clearance, meaning that European consumers might unknowingly be buying wood products linked to recent forest loss. This is a key concern ahead of the upcoming EU Deforestation Regulation (EUDR), which aims to bar imports of commodities associated with deforestation.
"Despite PEFC's claims that it can aid EUDR compliance, European companies must not rely on 'green labels,' but instead conduct their own due diligence to ensure there is no risk of deforestation wood in their supply chains," Earthsight said.
Loopholes
Earthsight attributes IFP's certification to systemic weaknesses in voluntary schemes like PEFC and Indonesia's legality system, which it says allow companies to maintain operations despite extensive forest clearance.
One structural issue is PEFC's "partial certification" model: companies can certify only the parts of their concessions that meet the standard, while excluding areas that don't. In IFP's case, PEFC said 81,533 hectares of its 100,989-hectare concession (201,472 out of 249,549 acres) were certified in 2024. The remainder, nearly a fifth of the total licensed area, was excluded because natural forest there had been cleared after the cutoff date of December 2010, including large areas deforested in 2023.
Earthsight says this setup creates perverse incentives. Companies can continue clearing natural forest after 2010, wait for the plantations to mature, and later certify only the older blocks – without addressing the environmental or social harms caused by the earlier deforestation.
The NGO also warns this separation raises the risk that timber from recently cleared areas enters certified supply chains.
PEFC told Earthsight it mitigates against this possibility through field inspections, volume checks and verification of harvest records.
But watchdogs argue weaknesses remain. In a 2017 review, the Environmental Investigation Agency noted that PEFC certification relies heavily on information supplied by companies themselves and lacks a robust and transparent complaints mechanism.
"Nevertheless, even if these safeguards ensure that all PEFC-certified wood originates from old plantations developed before 2010, does this not still undermine the purpose of certification if consumers seeking sustainable products are buying from a company responsible for extensive, recent deforestation?" Earthsight said.
A bottom-up model under fire
Another feature of the PEFC system, which the organization presents as a strength, is its "bottom-up" model, in which national members draft their own standards based on international benchmarks and then seek PEFC endorsement. PEFC says this allows standards to reflect national laws and local contexts, helping it cover more than 330 million hectares (815 million acres) of certified forest globally, a combined area larger than India.
But environmental NGOs have long argued this model allows for weaker safeguards at the national level. Greenpeace, in a 2021 assessment, found Indonesia's PEFC-endorsed scheme, the Forestry Certification Cooperation (IFCC), to be weak on protection of high-conservation-value forest, rules for conversion (clearing) of forest, controls over certification bodies, restrictions on pesticide use, respect for Indigenous rights, and overall implementation.
A 2024 audit of IFP underscores those concerns. It concluded IFP complied with the IFCC standard, even though the company had destroyed 29,075 hectares (71,846 acres) of forest between April 2010 and June 2024. Notably, 334 hectares (825 acres) of that loss occurred between August 2023 and June 2024 – after the company adopted a sustainable forest management policy in August 2023 pledging not to "significantly convert natural forests into plantation forests."
"Why didn't this raise alarm bells, signalling that PT IFP was an irresponsible company incapable of honouring a basic commitment to halt forest conversion after years of large-scale destruction?" Earthsight asked.
In its response, Mutu International, IFP's auditor, said the company was deemed compliant because the areas deforested after 2010 were kept outside the certified scope. It also acknowledged IFP had cleared 3,176 hectares (7,848 acres) of natural forest in 2022-2023, after adopting its sustainability pledge. Mutu classified these as "Major Non-Conformities," required the company to halt further conversion and prepare corrective and restoration plans, and said it had observed progress that it would continue to review through surveillance audits.
However, Mutu didn't specify what IFP's recovery plan entailed, and no evidence has been presented that any forest has been restored.
"As such, PT IFP was granted certification as a 'sustainable forestry' company, despite breaking its promise to end deforestation, and being required to restore the logged forest," Earthsight said.
Earthsight also noted that PEFC has certified other companies linked to the same corporate group as IFP – the secretive PT Borneo Hijau Lestari group – despite extensive post-2010 deforestation across their concessions.
"The fundamental weaknesses in voluntary certification systems have allowed large segments of the Indonesian timber industry to present a misleading image of sustainability," the NGO said.
Earthsight argued that to maintain its credibility and ensure consumers aren't unknowingly buying timber linked to forest destruction, PEFC should revoke its certification of IFP and strengthen its rules to exclude not only any company that has cleared natural forest since 2010, but also any company within the same corporate group.
"Without these changes, it risks becoming not just obsolete in the face of stronger supply-chain legislation, but a greenwashing tool for some of the planet's worst environmental offenders," the NGO said.