Financing forestry activities in the Heart of Borneo
1. Prioritize responsible financing
- Some major banks in Borneo have policies which prevent investment in unsustainable operations and promote investment in sustainable timber businesses.
- WWF has produced detailed guidance to help financial institutions develop and implement a responsible timber financing and investment policy.
- The World Business Council for Sustainable Development and PricewaterhouseCoopers also produced a toolkit to inform the responsible financing of activities which impact on forests.
2. Explore new financial incentivesNew types of financial incentives can help companies to take ecosystem services into account when concessions are allocated, and these could provide forestry companies with supplementary revenue streams to support sustainable activities.
Incentives include payments for ecosystem services, payments for carbon credits generated through Reducing Emissions from Deforestation and forest Degradation (REDD+) and Clean Development Mechanism (CDM) projects, as well as accessing price premiums through certification bodies.
There are a number of REDD pilot projects in Borneo.
- The Ramba Raya Conservation project covers 91,000 ha in Central Kalimantan and is currently selling carbon credits through the voluntary market to Gazprom Marketing & Trading. The area was purchased by InfiniteEARTH to avoid forest clearance.
- The INFAPRO project in Sabah is rehabilitating 25,000 ha of degraded forest, and is also selling carbon credits through the voluntary market. Following restoration the forest will be sustainably managed for timber and other forest products.
- WWF has a number of initiatives underway to help producers, investors and regulators access new financial opportunities.
- WWF is also a partner in The Natural Capital Project, which has developed a tool called INVEST (Integrated Valuation of Ecosystem Services and Trade-offs). This helps to map and value the services provided by nature and we are working with the three Heart of Borneo governments to use this tool in the region.