MEETING MINUTES

Round table on Sustainable Development of Viscose

14 January 2019, 9.00 AM – 4.00 PM

Grand Hyatt Hotel, Beijing

Facilitator: Liesel Truscott, Textile Exchange

Time

Speaker

Topic & Key Message Points

0900-0910

Yan Yan,
Social Responsibilities and Relations of CV and CNTAC

Welcome

CV

·         self-initiated by producers and self-regulating

·         a platform to demonstrate and make progress on transparency

·         aims to build capacity of producers and accelerate sustainable development of this industry

0910-0920

Liesl Truscott,

Textile Exchange

Dialogue Objectives

·         Encourage openness and transparency

·         To learn from each other

·         To apply systems thinking - join the pieces together to see how all fit together

·         To seek pre-competitive collaboration and collective action

0920-1000

Zhang Zixin,

CV

Review of CV’s  Work in 2018 and Next Steps

·         Introducing the CV Roadmap

·         Comparison of different criteria and CV methodology

·         CV Roadmap 2025

o    Action plan – next steps

o    Longer term plan

o    Stakeholder feedback to be included in plan

Hot Topics of Viscose

·         Procurement – forests

o    Most viscose producers do not produce pulp, therefore are not forestry experts

o    Need to identify who are the authority of sustainable forestry work and consult with them accordingly, as well as identify the tools for verification

·         Production

o    Clean Production Standards (CPS) vs EU-BAT - Most indicators are comparable, and both require the same level of performance in most indicators. The challenge is there is no harmonization in the measurement units and methodologies of the indicators; as such, standardization is needed

1000-1030

Huang Wen Bin,
WWF

Overview on Global Forestry

·         Deforestation in tropical areas and forest degradation in temperate and boreal forests are both risks to the world

·         WWF supports certification such as FSC, as well as inclusive approacheswhile recognizing that there are various other components/pathways that are able to address issues

·         China is the world’s largest producer and consumer of paper products, and therefore needs to play a more important role in the sustainable development of forests.

·         Supply chain transparency is a necessary step towards transformation and sustainable change.

·         Forest sustainability depends on the support of regulations and certifications. It is recommended that enterprises ensure their wood-based raw materials are from sustainable sources through third-party certification and verification.

·         While WWFsupports FSC, it also recognizes different countries have different conditions where only one certification may not be sufficient. Companies have to evaluate accordingly before developing sourcing policy.

1030-1045

Morning Tea-break

1045-1110

Zhang Xinxin,
NepCon

·         FSC and PEFC are the world’s largest certifications, both are believed to support sustainable forestry management

·         Hope CanopyStyle criteriacan be incorporated in CV Roadmap

·         Definition of ancient and endangered forest is mapped on forest mapper and the wording of the definition is a bit complicated and please consult CANOPY for detailed explanation,

·         Forestmapper is still new and may not be complete/holistic, NepCon will use more than one tool to do risk mapping of viscose producers’ supply chain

1110-1135

Boris Saraber,
The Forest Trust

Understanding & Achieving Zero Deforestation

·         Industry transformation is the ultimate goal which needs on-the-ground knowledge, and there are no single solutions

·         Certification is a tool; there are other means of verification and alternatives to support an inclusive approach to risk management and transformation including various certification standards, on the ground engagements, scientific methodologies and satellite-based tools.

·         There are a number of deforestation-monitoring map platforms in the market – e.g. Canopy’s Forestmapper, WRI’s Forest Global Watch.  From our knowledge of different tools such as these, we have seen in the past that often false- positives appear; whilea tool that offers near real-time monitoring, such as Starling, has been developed to build on these learnings

·         Encourages CV members to be more pro-active in communicating the positive changes that have taken place since the launch of the CV Roadmap and continue to do so.

·         Encourages brands to adopt a change-transformation approach rather than a risk-management approach via elimination through understanding the real situations on the ground, for e.g. in Sumatra, the main deforestation driver is not companies but small farmers.

·         A risk mitigation approach can be limited in driving real transformation as it often serves to de-link brands buying power away from promoting and supporting with change on the ground, which ultimately drives industry transformation

1135-1330

Lunch

1330-1355

Gundolf Klaehn,

Partnership for Sustainable Textiles

Thivararan Kumarsamy ,
Esprit

Brand sustainable purchasing policy and practice

·         Standards have to be practical and implementable, not just remain a piece of paper because no one can achieve them

·         Traceability for viscose supply chain is becoming more important for the brands.

·         Supports Canopy and Changing Markets Foundations (CMF)

·         Brands do not have capacity to verify change on the ground of forestry

·         As brands can be lacking in knowledge of viable forestry practices, the responsibility for ensuring sustainable practices often falls to that of the viscose or pulp producers

·         Brands therefore rely on guidance, certification and third-party verification

1355-1430

Li Shite,
CNTAC

CV Sustainability Report Preview

·         Target to launch in March 2019

·         Provides an important baseline for CV to know the current sustainability performance and provide targeted guidance for improvement.

·         CV members need to improve on fundamentals as well as support for transparency such as data submission

·         UNFCCC incorporation for long-term goal setting

1430-1530

Q&A

Questions/feedback from brands
(Inditex, ASOS, Next, C&A, H&M, Esprit, Tesco and M&S)

Brand:

·         More transparency required

·         Would there be more precise reporting, including disclosing and rating performance of each member?

CV:

o    CV understands the importance of transparency and will work towards improvement

o    In CV’s engagement with brands, realise downstream does not really understand upstream. Recognize there is much room for improvement in reporting and disclosure; CV will continue to improve on this front.

o    CV will be launching its first Sustainability Reportin March 2019 which will provide some data on the performance of CV members.

o    CV needs to first understand how EU-BAT figures are arrived. We will also explain how we arrive at our standards limits, including methodologies.

o    CV has started working on our CV Roadmap 2025, and will conduct invite stakeholder in due course.

Brand:How do you verify members’ performance – by 3rd party?

CV:

o    Most of the requirements in the CV Roadmap involves third-party verification, such as FSC, Oeko-Tex STeP and ZHDC)

o    Certain technical indicators may require longer time period for verification, in particularly when benchmarking with the likes of EU-BAT which we currently do not have sufficient understanding of, especially on indicators relating to air emissions. Until CV gets more clarity on EU-BAT, we will focus on the Clean Production Standards (CPS).

Brand:What is the position to use tools like HIGG? Oeko-Step?

CV:

o    CV has no preference for Higg over Oeko-Tex STeP, vice versa. Both are acceptable.

o    Currently more chose to do STeP Oeko-Tex becausethe auditor invited to present about Higg FEM 3.0 informed that Higg FEM 3.0 was not auditable then（2018.1）

Brands:Brands ask for sustainability point of contact for each viscose producer. Can CV provide?

CV:

o    CV deals with different topics and for each topic area there are different responsible personnel from each member company. Not every CV member has a dedicated sustainability personnel.

o    We will send you the contact list after the meeting, but for above-mentioned reason, not all contacts listed here are sustainability personnel.

Brands:Brands have developed a self-assessment survey for viscose producers; can CV get its members to do the survey?

CV:

o    Yes.

o    Viscose producers already have to undertake a lot of audits, standards. Hope brands can simplify the process and not duplicate work for producers.

o    CV suggests that the survey can be standardized and promote more brand use it, which can reduce repetitive work.

Brands:  What is the difference between CV and EU-BAT standards?

CV:

o    Most of indicators are comparable.

o    Some of the EU-BAT indicators,however, are not complete/holistic

o    Raw material and manufacturing are different.

On raw material front, have to rely heavily on pulp producers to drive sustainable development

On manufacturing front, CV is working with ZDHC to see areas which can be improved, including discussing about EU-BAT.

EU-BAT is astatic standard, what next after reaching those targets? It is not clear.

o    There are a lot of questions about EU-BAT that CV wanted to clarify and have asked CMF accordingly but received no response from them.

Brands:Does CV’s 2025 roadmap aim to align with or supersedethe CMF roadmap?

CV:

o    Has been working to get a baseline of all its members to help identify areas for improvement

o    Some members already outperform some of the CMF indicators. Need to understand how limits of other indicators are arrived in order to strive towards meeting those targets.

o    CMF have been invited to clarify but they declined

1530-1600

Yan Yan

Closing

Few key takeaways from the events:

·         Transparency as the basis for trust; CV will strive for more transparency

·         Multi-stakeholder– sustainability issues are not caused by one entity in the value chain and resolution cannot be achieved by single entity

·         Participation from industry and collaboration with key stakeholders should be intensified

·         Competence building of CV members required

1600-1800

Afternoon Tea-Break & Networking

1800-1900

Dinner