The first crucial step in assessing legality risks in a timber supply chain is identifying the origins of the sourced material and establishing which suppliers have been involved in handling it. Mapping your supply chain may be a helpful way to begin this process.
A supply chain map will let you:
- Gain an overview of each wooden components’ origin and its route to you.
- Identify all relevant actors at each step in your supply chain. This should include the country of origin, sub-national region or forest of harvest.
- Enhance your understanding of the risks that handling wood products sourced from multiple sources and countries comes with.
- Increase your confidence in your suppliers and the legality of the timber species and materials that you use.
- Enable you to verify the accuracy of the product claims made by your suppliers.
How to get started
To get started with mapping your supply chain, you should begin by asking yourself the following questions:
- Which of your products contain wood or wood-based materials?
- From which supplier(s) did you source said wooden materials?
- From which company and in which country did your supplier(s) source the product or input wood materials? (I.e. who is your sub-supplier?)
What information do you need?
For each of your products that contain wood or wood-based materials, it is helpful to collect the following information:
- Supplier information
- Name of the supplier
- Address and country of the supplier
- The nature of business of the supplier (e.g. a sawmill, packaging producer etc.)
- Certification code of the supplier (e.g. FSC/PEFC) - if applicable
- Product information
- Description of the Product (trade name and type of product)
- HS code (see what products are covered by the EUTR here)
- Product certification information (e.g. FSC/PEFC) and claim (e.g. FSC 100%, FSC Mix, etc.), if applicable.
- Composite or mono-material. It is important to identify if your product(s) consist of a single type of material or several components.
- Component description – if applicable (a description of each component the composite product may consist of)
- Species (trade name and, if applicable, its exact scientific name)
- Quantity (expressed in volume, weight or number of units)
- Origin of the material (country of harvest and, if applicable, sub-national region or forest concession of harvest).
Useful considerations when mapping your supply chain:
- A good approach is to create a map for each of your products containing wood or wood-based materials. If a product consists of multiple wood components from different sources, it is advisable to make a supply chain map for each individual product component.
- A supply chain map may be simple in design and can be kept in a spreadsheet. A supply chain mapping software solution can also be useful to help you better visualise your supply chain.
- The level of detail of your supply chain map may differ from product to product, depending on the complexity of your supply chain. Your supply chain map should be sufficiently detailed to give you confidence in the area of origin (country, sub-national region or forest concession of harvest) of the timber or wood-based materials you source.
- To create a good supply chain map, you need to acquire information from your suppliers and potentially from your sub-suppliers and their suppliers. The best approach is to engage your suppliers in the process.
- A factor that may influence the level of detail is the risk of illegality in the country of harvest. Suppose you are sourcing wooden material from a country of harvest, where the risk of illegal harvesting and trade in illegal timber varies between sub-national regions or between forest concessions. In that case, it may not be sufficient to simply identify the country of harvest. In this case, you may need to work with your suppliers to identify all links in your supply chain back to either the sub-national region or forest of harvest, respectively. Examples of actors could be manufacturers, traders, distributors, mills, processors, logging companies, and forest management units. Mapping your entire supply chain is an important step in mitigating the risk of illegalities in your supply chain. Read more on assessing the risk of illegal harvesting and trade in a country of origin here.
- It is recommended to reassess your supply chain map annually or whenever changes to your supply chain occur. It is advisable to require your suppliers to report any relevant changes in their supply chain to you.
- Question what documents you are currently collecting and if they are useful. Documentation is crucial to demonstrate the legal origin of the timber or wood products you purchase, but it also builds confidence in your supply chain map by documenting the links between your suppliers and sub-suppliers. However, it is important to not simply collect as many documents as possible, but rather to collect the right documents to verify your supply chain and the legality of the products that you source.
While documentation is beneficial when mapping your supply chain and verifying legality, it is crucial to bear in mind that documentation can also be misleading or even fraudulent. When assessing the validity of your documentation, please consider the following:
- Relevance - does the documentation apply to your specific supply chain or shipment, and does it tell you anything of significance? It happens that documents are used for multiple deliveries and passed on to several buyers. This risk can be addressed by cross-referencing documents relating to the same shipment.
- Validity – is the information provided genuine, valid and issued by a competent authority. Identify a method to test its validity.
- Correctness – is any information missing in the documentation? Does it contain apparent errors, or does it contradict other information you have received?
- Completeness – does the information you have acquired paint a complete picture of your supply chain? Are there any links in your supply chain that are not supported by documentation?
It is important to assess the following two supply chain-related risks to get a complete and correct picture of your supply chain:
- Risk of substitution - This refers to the risk that the species of wood you have purchased may have been replaced by a similar species somewhere in the supply chain.
- Risk of mixing - This refers to the risk that the material you are sourcing has is mixed with other (unknown) material.
It differs from country to country what documents you are legally required to have when sourcing timber and wood products. You can read more about legally required documents in the Risk Assessments and Document Guides found on Preferred by Nature’s Sourcing Hub. You may also refer to ATIBT’s Timber Trade Portal for more information on the topic.
It is important to keep records for at least five years systematically. This should include invoices, delivery notes, supplier contracts, purchase orders, shipping documents such as bill of lading and insurance certificates.
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