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Daily News / Forestry / Sawmilling / Asia & Middle East / Global
August 17, 2016

FSC to disassociate from BILT and its Malaysian subsidiary SFI

FSC to disassociate from BILT and its Malaysian subsidiary SFI

The Forest Stewardship Council (FSC) has announced that it has disassociated from Ballarpur Industries Limited (BILT) and the subsidiary company Sabah Forest Industries (SFI).

According to a FSC press release, this decision comes after a lengthy review process of the conclusions by an independent complaints panel that conducted a thorough investigation into the complaint filed by Building and Wood Workers International (BWI) in March 2015. The complaint alleged that SFI refused to uphold the International Labour Organization’s (ILO) Core Conventions on Freedom of Association (Convention No. 87) and Collective Bargaining (Convention No. 98).

The independent complaints panel concluded that there was clear and convincing evidence that SFI was not complying with both principles, leading to a decision on the case by the FSC International Board of Directors. In its assessment, the Board of Directors required BILT and SFI to submit an action plan and a progress report on recommended corrective measures no later than 24 June 2016, a deadline that was further extended to 30 June at BILT’s request.

Failure to submit both the action plan and progress report, as well as show a clear and significant commitment to fulfill the recommended corrective measures, have prompted the decision to disassociate, despite FSC allowing ample time for both companies to implement these actions.

The FSC Policy for Association requires certificate holders to comply with ILO Core Conventions. Non-compliance is a violation of the FSC Policy for Association and prompts a review by an independent complaints panel and, when necessary, disassociation by the International Board of Directors.

Ballarpur Industries Limited (BILT) is a flagship of the US$4 bn Avantha Group and India's largest manufacturer of writing and printing (W&P) paper. The current chairman of the company is Gautam Thapar, who succeeded his late uncle L.M. Thapar.

BILT's subsidiaries include Sabah Forest Industries (SFI), Malaysia's largest pulp and paper company, and BILT Tree Tech Limited (BTTL), which runs BILT's farm forestry programme in several states in India.

BILT has six manufacturing units across India, which give the company geographic coverage over most of the domestic market. BILT has a dominant share of the high-end coated paper segment in India. The company accounts for over 50% of the coated wood-free paper market, an impressive 85% of the bond paper market and nearly 45% of the hi-bright Maplitho market, besides being India's largest exporter of coated paper.

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