MEDIA STATEMENT: Canopy Statement on Recent Sateri/APRIL/RGE Announcements Oct 10/19

Canopy is pleased to acknowledge indicators of some early stage progress in addressing controversial fibre production and fibre sourcing by the Royal Golden Eagle corporate family, including viscose producer Sateri and pulp producer Asia Pacific Resources International Limited (APRIL). Canopy is happy to provide the following additional context on the public announcements that both companies have made during the past weeks.

Sateri’s Action Plan to Start Addressing its Social and Environmental Impacts

In 2018, a CanopyStyle Audit of Sateri identified risks in their supply chain, related to both impacts on Ancient and Endangered Forests, and social controversy linked to sourcing from APRIL. Canopy proposed an initial action plan to begin addressing some of these risks and Sateri has responded, working with APRIL to initiate action on the first round of identified issues.

While Canopy is encouraged by the progress to date, it is important to note this is the first step in a long-term process. APRIL’s ongoing operations on peatlands 1,2 have significant climate and ecological impacts 3; the company continues to be mired in ongoing social conflicts that need to be satisfactorily addressed, and APRIL’s legacy of harm to both the environment and communities requires serious long-term investment in redress and restoration 4,5.

Key ecological progress that Sateri has committed to in this first stage of its Action Plan include:

  • Support for conservation initiatives in the Leuser Ecosystem.
  • APRIL commitment to not source natural forest fibre from, or directly or indirectly cause the development of new plantation concessions in Intact Forest Landscapes in Indonesia and elsewhere, specifically in the Leuser Ecosystem, West Papua and Kalimantan.
  • New transparency measures that will ensure public access to all High Conservation Value (HCV) and any High Carbon Stock (HCS) assessments.

Remaining gaps include:

  • A commitment to phase out the use of dissolving pulp inputs sourced from peat, other socially or ecologically critical forest ecosystems and fibre sourced from Ancient and Endangered Forests, offsetting those with Next Generation alternatives and recycled fibre.
  • A commitment that the long-term goal of scaling up and commercializing production of Next Generation fibres will correspond to an immediate reduction in the use of plantation fibre from peat and mineral soil regions.
  • An RGE-wide commitment to no development in the Leuser Ecosystem, West Papua or in any marginally fragmented lands of high conservation value in Kalimantan.
  • Encouraging parent company RGE and its affiliates to remedy its legacy of social and ecological harm in order to support vibrant, healthy local communities.
  • Development of explicit targets and timelines for new innovative commercial scale product lines containing alternative and Next Generation fibres.

Despite the work that remains to be tackled, Canopy is encouraged by the initial steps taken by Sateri and is committed to continued, constructive discussion and actions.

APRIL and Royal Golden Eagle Invest in Closed Loop Technology and Next Generation Fibres

Parallel to Sateri’s actions, their corporate parent and sister company, and largest pulp supplier, RGE and APRIL have announced their investment in cleaner manufacturing technology and Next Generation fibre feedstock research and development. Canopy welcomes these investments and the signal being sent to the marketplace that the future of sustainability lies in alternative fibre inputs.

With APRIL’s current plantation base heavily located on peat and other high carbon and bio-diverse landscapes in Indonesia, the timely commercial-scale development of Next Generation alternative feed-stocks will be critical in enabling APRIL to replace significant, controversial portions of their current fibre basket 6,7. Next Generation alternative fibres have the potential to create a solutions space for APRIL to meet their production capacity needs whilst enabling them to restore damaged peat and high carbon landscapes currently in their plantation base. We note that Next Generation fibres need to be blended with forest fibre that is free of Ancient and Endangered Forests and controversial sources to meet marketplace expectations.

Within the announcement we note the bulk of the funding (70%) is directed toward closed loop processing with a smaller portion going to the exploration of Next Generation fibres. Chemical use and effluents are critical environmental issues and Canopy fully supports investment addressing closing the loop. Recognizing this is not Canopy’s area of expertise we are partnering with others in the space.

In parallel to cleaner processing, we will continue to encourage RGE/APRIL to prioritize funding specific to alternative fibre development.

Next Steps on Next Generation for RGE:

  • First and foremost, Canopy is seeking a statement of intent from APRIL that Next Generation fibres will offset fibre that is currently putting a strain on our world’s Ancient and Endangered Forests, including peatlands, vs. innovative fibre leading solely to additional production of greater volumes of viscose as an add-on product while risk remains in the majority of the company’s supply chain.
  • We encourage RGE companies to include targets for commercial-scale production, timelines for products, and fibre blend details (eg: specific objectives on percentage of recycled cotton or alternative fibre). One doesn’t always meet a set target, but specifying objectives provides a clear sense to customers of commitment and intent.

Moving forward

Brands are articulating a clear preference for purchasing man-made cellulosic fibres with a minimum 50% of Next Generation fibre sources as of 2020. With two of the world’s top five viscose producers already to market with commercial viscose lines that contain 20 – 30% recycled viscose, we expect to see significant, continued advancements in Next Generation Solutions in the coming 12 months.

Safeguarding Ancient and Endangered Forests is at the foundation of the CanopyStyle initiative and the collective efforts of 200+ brands and viscose producers representing 74% of the entire global supply of viscose. Together we will continue to monitor progress and shift the viscose supply chain towards greater sustainability.

Canopy welcomes the steps taken by Sateri, APRIL and RGE while acknowledging much work remains. We look forward to continued work with the RGE group to advance significant progress and change on the ground in the coming months and years.

For more information, please contact:
Laura Repas, Canopy

+1 416 729-7484