Helveta: Supply Chain Software Firm Tackles Deforestation by Digitizing Trees, Timber

From its office near Oxford, UK supply chain management software specialist Helveta is taking on a big sustainability challenge: that posed by illegal logging and deforestation.

It's estimated that deforestation accounts for anywhere between 1/6 and 1/4 of global carbon emissions, yet the drive to make money and promote economic development continues to result in the loss of vast areas of forest around the world. Despite a drive toward more sustainable forestry, illegal logging is rife in what remains of the world's large forests. Helveta's solution: digitizing trees so that timber can be tracked, and its origins authenticated, from forest to market.

Best estimates are that forests cover some 30% of global land area (nearly 4 billion hectares), providing numerous valuable, and some invaluable, ecosystem services and goods for millions of people. They also provide habitat for millions of plant and other animal species with which we share the planet. There's more carbon stored in these forests than there is in the Earth's atmosphere--some 638 billion metric tons as of 2005, according to the UN Framework Convention on Climate Change (UNFCCC). Helveta: Using Digital Technology to Tackle Illegal Logging and Deforestation

Yet, we were losing forest at a rate of some 13 million hectares per year between 1990-2005. Besides wiping out all that forest habitat, and the ecosystem services they provide, it's estimated that deforestation resulted in approximately 5.8 gigatonnes of carbon dioxide emissions per year (GtCO2/year). Estimates of the percentage of man-made global CO2 emissions from deforestation range from more than 15% to as much as 25%. It's clear that humans need to preserve and learn how to make use of forests without destroying them.

A significant amount of illegal logging continues to occur, thwarting numerous high-profile efforts to reduce and/or eliminate deforestation. Illegal loggers clear-cut forest the size of a football field every two seconds, generating criminal proceeds of between $10 billion and $15 billion a year, according to a World Bank report released March 20.

Founded in 2004 and rooted in an environmental ethic, Helveta's been tackling the problem at the source, engaging local residents-- including West African pygmies-- to make use of its state-of-the-art digital supply chain management system to tag forest trees and track timber from the time and place where its cut down through to end-user markets. The company's efforts have recently garnered international accolades.

Helveta on March 21 won in the Environment category at the 2012 FT-Arcelor Mittal "Boldness in Business Awards," which "recognizes companies and individuals who have stood out for their dedication to innovation and change in the interests of commerce."

“If a sixth of global CO2 emissions come from deforestation and 1.6bn people depend on forests for their livelihoods, then halting deforestation is a critical development challenge. And yet it has proven a tough nut to crack," PwC partner and awards judge Leo Johnson commented regarding Helveta's achievements in tackling illegal logging and deforestation.

"You can win on the demand side, by getting consumers and companies to demand sustainable wood, but how do you ensure that the wood from forests across equatorial Africa and south-east Asia is harvested sustainably? Helveta’s business model is simple: technology that maps timber supply chains from forest to furniture outlet, giving traceability, chain of custody control, and guarantees of legal compliance.”

Equipping African Pygmies with Magic Boxes

Helveta's timber supply chain management system entails recruiting locals to tag forest trees with bar codes and then employ its optical scanner/computing/radio transceivers to record and share detailed information about trees and forest, including how locals view and make use of them.

One pilot project in Cameroon's Congo River basin involved recruiting resident pygmies to use what they dubbed "magic boxes" to tag and scan trees, according to an FT report.

“Forestry groups will say, ‘no one lives here’,” Simon Bates, head of implementation at Helveta, told the FT's Rose Jacobs. “The icon-based system shows ‘this is a sacred tree; I fish in this river; I drink this water’. It shows ‘this is my home’.”

Helveta's profile report on the project-- which was carried out in partnership with Cameroons' government-- attracted the attention of Ed Lascelles and colleagues at venture capital firm Albion Ventures.

A Green, Sustainable Supply Chain for Timber?

“You could see that illegal logging was clearly an issue that was only going to become higher profile and there would be increasing amounts of legislation and market reaction to impose some level of control on the trade in illegal timber,” Lascelles was quoted as saying. “And if you looked through the range of technologies and the different ways people were thinking about it, it just seemed that to use some sort of tracking of the asset was going to be the answer.”

The idea of employing the RFID (Radio Frequency Identification) technology now commonly used in industry and commerce to track the origin of a wide range of products in the timber industry is gaining traction. Helveta's ability to recruit locals and win community support, as well as the ease-of-use and reliability of its system, is playing a big part in its success.

The company's developing or has launched pilot tree-and-timber tracking systems in eight African countries and is also intent on launching new pilot systems in Southeast Asia and Latin America. Helveta's strong environmental ethic has prompted it to take on projects that companies driven strictly by the potential for monetary profit pass up, or would never even think of. That poses some considerable financial challenge to the company, yet it remains committed to its sustainable, Triple Bottom Line business approach.

The need for systems that can help developing and developed countries make more sustainable use of the world's forests is certainly there, and is increasingly pressing. A lot rides on Helveta's ability to work with governments, locals and timber industry players to scale pilot projects up to national level. At the same time, management believes the potential is there to employ its system to track and authenticate the source and origin of a much wider range of natural resources subject to irresponsible exploitation, including cocoa, rare minerals and biofuels.

*Photo courtesy: Helveta