Intermediaries
HIGH-POTENTIAL VENTURES IN THE FOREST ECONOMY VALUE CHAIN
Through our work, CSFEP has learnt that there is a need to build local hubs and capacity across the forest economy value chain. These solutions will become the enabling ecosystem that will support new ventures, and help attract the required commercial investment. A single, global entity will not have the right business model and contextual understanding to meaningfully support these types of initiatives in the long-run. Rather, a series of different ventures is needed to fully unlock these markets.
Recognizing this, we began to investigate a variety of lean local entities that need to be developed and capacitated to provide relevant, timely and affordable support to climate smart forest economy ventures. These "intermediaries" we identified could take the form of for-profit or non-profit entities, depending on the required role.
KEY CHALLENGES WERE IDENTIFIED IN 7 FOCUS AREAS
Finance and Insurance
Key challenges include:
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Lack of investment into initiatives
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Limited understanding of investor needs and requirements
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Lack of innovative financing mechanisms
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Few investors willing to take on the associated risks
Knowledge Ecosystem
Key challenges include:
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Knowledge gaps in the utility and benefits of building with timber
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Limited understanding of tree species' properties for products
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Limited research on demand impacts on forests & biodiversity
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Lack of risk-based analysis of true impact across the value chain
Product Certifications
Key challenges include:
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Lack of governing standards for sustainable forest economies
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Low utilization of carbon credit certificates
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High costs of certification and registration
Policies and Regulations
Key challenges include:
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Lack of cohesive forestry national / regional strategies
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Prevalence of illegal logging and timber practices
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Restrictive policy on timber products
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Lack of enforcement of existing strategies
Timber-based Real Estate
Key challenges include:
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Limited and scattered resources for navigating ecosystem needed to build with timber
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Few opportunities for traditional real estate players to plug into the mass timber ecosystem
Communications and Awareness
Key challenges include:
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Low end-consumer opinion of timber-based construction
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Negative perception among key stakeholders across the value chain
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Inadequate sharing of lessons learnt
Value Chain Linkages
Key challenges include:
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Few actors have insight / visibility across the value chain
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Few high-value timber processors within proximity to sustainable forests
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Challenges determining how best to source sustainable timber
SHORTLISTED INTERMEDIARIES
Understanding industry need, program partner capabilities, timeframe to set up and realize impact, and the landscape of complementary solutions allowed us to identify the three intermediaries we believe have the most potential to spur the develop of climate smart forest economies today. For each shortlisted intermediary, we have started to understand the opportunity, landscape, and potential development. To learn more, please contact us at csfep@dalberg.com.
OTHER INTERMEDIARY OPPORTUNITIES
Beyond the shortlisted intermediaries, opportunities were identified in each of the challenge focus areas. A brief description of each intermediary, and a rationale for the market opportunity, can be found below.
Category | Intermedairy | Description | Learn More |
|---|---|---|---|
Communications and awareness building | Global dialogue facilitator | Create a community of key stakeholders, practitioners, interested actors and non-participatory actors for CSFEs globally and locally | Learn More |
Communications and awareness building | Community engagement support | To ensure sustainability and success of social-based forestry initiatives by fostering meaningful relationships with local communities | Learn More |
Finance and insurance | CSFE value chain carbon credit intermediary | A carbon credit offering that takes into account the carbon benefits of all aspects of the 3S value chain: sink, sequestration, and substitution | Learn More |
Finance and insurance | CSFE investment fund | A portfolio of CSFE companies vetted by the intermediary for investment by commercial funders | Learn More |
Finance and insurance | Green finance capacity building for financial institutions | Equip financial institutions to identify and support the development of climate-smart initiatives in currently underserved geographies, like Africa, Asia, and Latin America | Learn More |
Finance and insurance | Financing and investment support | Connect forest economy and timber construction actors to potential sources of commercial and philanthropic investment to support the development and scaling of the global forest economy market | Learn More |
Finance and insurance | CSFE insurance products and policies | Enable forest economy and timber construction actors to access bespoke insurance products at affordable rates | Learn More |
Finance and insurance | Tokenization of climate-smart practices | Leverage market forces to encourage adoption of climate-smart practices across forest economies by generating revenue from climate-positive activities and practices | Learn More |
Forest and timber policies | Advocacy and policy/strategy development | Promote the development of local, municipal, regional, national, and multinational strategies and policies that are supportive of CSFE and timber construction | Learn More |
Product and process certifications | CSFE certification / mark of integrity | Create standard criteria and benchmarks on social and environmental impacts across the 3S framework from a credible authority that all CSFE actors can be measured against in their activities and products. Offering a certification or mark of integrity would provide recognition and an incentive to adhere to climate-smart forestry and construction practices. | Learn More |
Product and process certifications | Carbon & forestry certifications assessment report | To enable easier navigation of the types, quality and criteria of existing voluntary carbon offset certification bodies | Learn More |
Timber knowledge ecosystem | Professional advisory services | Top-tier strategic advisory support services for actors looking to understand how to optimize their CSFE work or to pivot their organization to align with CSFE and 3S goals | Learn More |
Timber knowledge ecosystem | Carbon impact assessment provider | Enable more accurate and comprehensive understanding, monitoring, and assessment of the carbon impacts of the activities of CSFE actors across the value chain | Learn More |
Timber knowledge ecosystem | Data collection and analysis service | Support CSFE businesses in collecting and analyzing data about their environment, their operations, and their community, so as to improve decision-making for efficient practices and effective implementation of safeguards | Learn More |
Timber knowledge ecosystem | Forest technology consultancy | Increase operational agility and efficiency of actors across the value chain | Learn More |
Timber knowledge ecosystem | CSFE education, upskilling, and training | To increase the capacity and capabilities of CSFE actors and maintain access to and awareness of the latest information and innovations across the value chain | Learn More |
Timber-based real estate | Full-service timber-based real estate firm | A one-stop shop for the development, construction, and management of commercial and residential timber buildings | Learn More |
Timber-based real estate | CSFE value chain linkages app (Uber for wood) | Connect real estate actors to the service and product providers best positioned to provide what is needed to support mass timber construction efforts | Learn More |
Timber-based real estate | Real estate-funded forest investment fund | Develop a fund to invest in forest economy and timber-based real estate projects, drawing on traditional real estate financiers | Learn More |
Value chain linkages | Manufacturing consultancy | Establishment of climate-smart high-value wood-processing facilities to support the development of regional and local supply chains in areas where lacking | Learn More |