Forests Sourcebook - HCV Resource Network

inputs (communities), and cost savings (companies), while
longer-term motives include social responsibility and securing
land tenure or long-term use rights.
Company-community forestry partnerships have the
potential to contribute to Bank objectives of SFM and rural
development. A recent international review (Vermeulen and
Walubengo, 2006) concluded that these partnerships can
help communities reduce risk, achieve better returns on
land use, diversify income sources, access paid employment,
develop new skills, upgrade infrastructure, and enhance
ecosystem management. They are also a mechanism for
companies to practice SFM on their own land (Brody et al.
2006). However, company-community partnerships have
not yet proved sufficient to lift people out of poverty and
remain supplementary rather than central to income
generation.
OPERATIONAL ASPECTS
Context and conditions for partnerships. Experience
shows that company-community forestry partnerships can
emerge under a wide range of political and economic
conditions. In considering whether partnerships may be
appropriate—and what kinds of partnerships are likely to
work—some important conditions to consider include the
following:
■
Production and markets
– Sound business. Artificial promotion of partnerships
for social gains will not work—an internationally
competitive ratio of benefits to costs and risks must
be demonstrated for specific forest products at the site
level.
– Integrated land use. Trees for fiber and fuel compete
with food crops and grazing land and may or may not
provide differential environmental services—
partnerships will only work where a locally appropriate
balance is achieved.
– Multiple use. Opportunities for multiple land use at
one site favor the use of partnerships (such as combining
timber production, NTFP production, and
ecosystem functions).
– Market maturity. New production systems and new
markets favor tight contractual partnerships while
developed, open markets favor looser arrangements.
– Access to technology and information. Insufficient technical
and market knowledge among communities is a
major disincentive to formation of partnerships.
■
Policy and governance
– Land tenure. Changes in land and resource tenure
(such as the privatization of state forests or securing
of collective land title) often precipitate partnerships
because partners need new deals to access forest
production.
– Forest sector incentives. In some countries, specific policy
statements encourage partnerships (such as the
comanagement requirements for state forest land).
– Extra-sectoral incentives. Some policies are generally propartnership,
such as those that encourage decentralization
(see note 5.1, Decentralized Forest Management) or
provide incentives to indigenous or small-scale business,
while particular policies encourage different types of
partnership (for example, environmental tax breaks
favoring ecosystem service partnerships).
– Governance. Implementation and survival of partnerships
require considerable backstopping, including
functional courts and efficient systems for legal recognition
of representative bodies (see note 5.4, Strengthening
Fiscal Systems in the Forest Sector). 1
– Private-sector policy. Multinational corporate policies
can precipitate transfer of partnership models
internationally.
Contractual arrangements. Partnership models may be
based on successful arrangements elsewhere—and initial
negotiations often depend on an external moderator. Typical
agreements, verbal or written, include terms for financial
and technical inputs, loan repayments, and benefit-sharing.
Partners involved can benefit from advice and oversight on
contractual terms (see Mayers and Vermeulen [2002] for
guidance), and options for making the most of external
incentive schemes should be explored, including carbon
credits, certification, or business compacts.
Time requirement for forming partnerships. It takes
continual investment over long periods to build
partnerships. Experience to date reveals three broad
scenarios for the development of company-community
forestry relationships: (i) little constitutive change over long
periods, with the company partner taking the lead in
directing the partnership; (ii) strengthening of the
community partner’s position, such as renegotiation of
benefit sharing or the community forming a company; and
(iii) dissolution of the partnership (see “Ending a
Partnership” below). A move toward tighter partnerships is
not always desirable—in buoyant, competitive forest
NOTE 2.1: COMPANY-COMMUNITY PARTNERSHIPS 73