Tuesday, 15 April 2014
OCP Consultation With Industry
On Tuesday the 8th of April, the FSC Director General and staff met with industry partners from Europe and North America (SCA, Stora Enso, Domtar, BillerudKorsnäs, and IKEA). The meeting was the first of a series in which FSC is consulting with stakeholders of all chambers to develop the path forward for the Online Claims Platform (OCP), a consultation mandated by the FSC International Board of Directors.
The group agreed that the current FSC Chain of Custody (CoC) system lacks oversight of transactions made between certified companies, that this allows inaccuracies to enter the system and needs to be corrected. It is clear that the current system does not effectively control a number of possible ways that inaccurate claims can be passed through supply chains, but there is not yet a shared understanding of how widespread these events are or how frequently they happen. The group agreed that false and inaccurate claims differ greatly depending on country and region, and it was concluded that the extent of the problem requires further analysis.
The OCP is specifically designed to ensure that both parties have an identical record of an FSC transaction. The group agreed that it could play a key role in addressing inaccurate claims. However, as currently designed, the OCP will store data from the FSC community in one centralized database, and this gives rise to two of the most pressing concerns of stakeholders – potential legal constraints and commercial liabilities associated with storing company sensitive information in a centralized database beyond the direct control of the company.
It was agreed that it must be analyzed to what extent the OCP has the potential to reduce the administrative burden of being CoC certified by automatically meeting the requirements of the CoC standard. The industry members of the group agreed to feed into the ongoing process within FSC to identify specific CoC requirements that could be met through the use of the OCP, and thereby eliminated from the audit process.
The group also considered how the OCP should be introduced – provided stakeholder concerns about legal and commercial liability could be satisfied. It was concluded that further analysis is required to determine if the OCP should be presented as a general mandatory requirement for all Certificate Holders or whether it would be viable to require it based on certain risk criteria or whether it could simply be made available on a voluntary basis. This analysis should also include an assessment of costs and benefits to stakeholders.
The following next steps were identified to move the process forward:
- FSC will develop additional background information on the source of inaccurate claims associated with the current CoC system and how the OCP will manage to reduce, minimize or eliminate these inaccurate claims.
- FSC will conduct further analysis to establish where in the supply chain these issues are most likely taking place [by geography, sector, company size etc.].
- FSC will determine whether other solutions such as transaction auditing would be viable and clearly identify how and where they differ from the OCP.
- FSC will engage relevant experts to assess the potential commercial liabilities associated with storing transaction data in a centralized database. This activity will also consider the possibility of localized storage (within Certificate Holder’s existing data boundaries) as well as hybrid solutions.
- FSC will document further how CB and ASI auditors will use and have access to any data stored in the OCP and make the proposed mechanisms associated with this process clear.
- FSC will explore how the OCP could be used to extensively reduce the administrative burden of being CoC certified and will gather input on this from the group.
- FSC will develop further the concept of having aspects of the OCP as voluntary measures and/or implemented on a risk based approach.
The group will meet again in the early summer to take the discussion further and explore issues on cost and benefits associated with implementation. This will take place simultaneously with consultation with other industry sectors, as well as social and environmental interests.
For further information on the Online Claims Platform, please visit the OCP website: http://ocp-info.fsc.org/