Forico is a management company established by NewForest, which needs to demonstrate both financial responsibility to shareholders and corporate social responsibility to government and community stakeholders.
45% of Forico’s estate in Tasmania is native forests, which provide vital ecosystem services such as habitat for wildlife, water filtration, flood mitigation and recreational opportunities for local residents and tourists. Forico has always gone beyond its regulatory obligations to manage these environmental assets for ecologically and socially sustainable outcomes and aims to “make every hectare count”. However, it has struggled to definitively measure or demonstrate the economic and environmental benefits that flow from this approach.
Forico has become the world’s first commercial forestry organisation to embrace the ecosystem accounting framework outlined in the UN’s System for Environmental-Economic Accounting (SEEA) as a means to demonstrate the combined economic and environmental value of its sustainable native forestry practices (Project Summary).
IDEEA Group has helped Forico develop extended accounts that record its stock of ecosystem assets, measured in biophysical terms, and flows of ecosystem services, such as those described above, alongside more traditional measures of timber harvest volumes and values. The approach also incorporates accounting for the current condition of Forico’s native forest areas in terms of their ecological integrity and robustness, and identifies the range of beneficiaries of ecosystem services flowing from these native forest assets, including government and local communities.
By developing ecosystem accounts to complement its traditional economic accounts Forico has established a benchmark that will underpin continuous improvement in ecosystem management and revealed the extent of potential new revenue streams. The accounts will provide all stakeholders with clear insight into what it means to be economically and socially sustainable by revealing the environmental assets that underpin Forico’s relationship with its local economy and community. The accounts will also underpin recognition by environmental stewardship bodies such as the Forest Stewardship Council (FSC) and Water Stewardship Australia (WSA), and support positive community engagement around specific issues of environmental and social responsibility.
In terms of management insight the spatially defined, integrated model of ecosystem assets and condition used to derive Forico’s ecosystem accounts has also created a new, highly actionable platform for capturing and analysing all sorts of operational data, which opens a variety of avenues for improving the efficiency and productivity of Forico’s native forestry management.