FORESTRY H a n s The e n • Global Forest Sector P a n w a r Changes, Practices, and Prospects • V l os biofuels k y “… tells readers why the business of forestry is about so much more than business. … a comprehensive and timely book, providing a roadmap to the uniquely fulfilling, if sometimes maddening, modern strategy aaccttiivviissmm business of forestry. … The forestry sector has been the ‘beta test’ for a number of sustainability € solutions, such as voluntary certification, public/private partnerships, technology innovation, and markets for ecosystem services. … [the book] offers insights useful for all.” T —Cassie Phillips, Weyerhaeuser Company h $ e ¥ “This book comes out timely in charting out the changes in the forest industry’s global context, its relation with the environment, and new products and markets. It will help readers to envision the G energy responsibility broader strategic importance of the forest industry, and hopefully reinforces the concept of sustainable l forest sector development worldwide.” o —Jukka Tissari, Food and Agriculture Organization of the United Nations b “… perfectly timed … I can easily see leaders in our industry recommending most of their top a management teams to read the book and get together to discuss the thoughts and trends described l and explained throughout the text. … I am looking forward to seeing this next generation of forest TThhee F products professionals entering the workforce with this text as a backbone of their educational experience.” o —David Stallcop, Global Marketing Manager, Vanport International, Inc. r GGlloobbaall FFoorreesstt e “Perhaps the greatest value is as an authoritative, comprehensive resource for academic leaders, s students, and scientists at all levels. … an essential addition to libraries, offices, conference rooms, and t research laboratories worldwide.” SSeeccttoorr —Jim Bowyer, Director, Dovetail Partners, Inc., and Professor Emeritus, University of Minnesota S e “ … the highly regarded contributors to this effort bring the analysis of the forest sector at a new c scale, with a depth of field unseen yet. … equally valuable to managers and practitioners, which is an accomplishment to be praised.” t —François Robichaud, Research Leader, Business Analysis and Forest Products Marketing, FPInnovations o Changes, Practices, and Prospects r K13712 Edited by Eric Hansen • Rajat Panwar • Richard Vlosky 6000 Broken Sound Parkway, NW Suite 300, Boca Raton, FL 33487 711 Third Avenue New York, NY 10017 an informa business 2 Park Square, Milton Park www.crcpress.com Abingdon, Oxon OX14 4RN, UK w w w . c r c p r e s s . c o m The Global Forest Sector Changes, Practices, and Prospects The Global Forest Sector Changes, Practices, and Prospects Edited by Eric Hansen (cid:127) Rajat Panwar (cid:127) Richard Vlosky Boca Raton London New York CRC Press is an imprint of the Taylor & Francis Group, an informa business Copyright Chapters 1–2, 4–14, 16–18 by Taylor & Francis Copyright Chapter 3 © European Forest Institute Copyright Chapter 15 David Cohen, Anne-Hélène Mathey, Jeffrey Biggs, and Mark Boylan, National Resources Canada, Canadian Forest Services © Her Majesty the Queen in Right of Canada and Taylor & Francis CRC Press Taylor & Francis Group 6000 Broken Sound Parkway NW, Suite 300 Boca Raton, FL 33487-2742 © 2014 by Taylor & Francis Group, LLC CRC Press is an imprint of Taylor & Francis Group, an Informa business No claim to original U.S. Government works Version Date: 20131025 International Standard Book Number-13: 978-1-4398-7928-3 (eBook - PDF) This book contains information obtained from authentic and highly regarded sources. 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Visit the Taylor & Francis Web site at http://www.taylorandfrancis.com and the CRC Press Web site at http://www.crcpress.com Contents Preface ............................................................................................................................................vii Acknowledgment ...........................................................................................................................ix Editors ..............................................................................................................................................xi Contributors .................................................................................................................................xiii Section I Changing Context of the Global Forest Sector 1 Understanding and Managing Change in the Global Forest Sector ...........................3 Eric Hansen, Rajat Panwar, and Richard Vlosky 2 Impact of Globalization on Forest Users: Trends and Opportunities .......................15 Benjamin Cashore, Erica Pohnan, and Michael W. Stone Section II Changes in Product Categories and Individual Markets 3 Markets and Market Forces for Lumber ..........................................................................41 Matt Bumgardner, Steven Johnson, William Luppold, Frances Maplesden, and Ed Pepke 4 Markets and Market Forces for Secondary Wood Products ........................................77 Urs Buehlmann and Al Schuler 5 Markets and Market Forces for Pulp and Paper Products ...........................................99 Lauri Hetemäki, Riitta Hänninen, and Alexander Moiseyev 6 New Products and Product Categories in the Global Forest Sector .........................129 Zhiyong Cai, Alan W. Rudie, Nicole M. Stark, Ronald C. Sabo, and Sally A. Ralph 7 Chinese Era ..........................................................................................................................151 Xiaozhi (Jeff) Cao, Xiufang Sun, and Ivan Eastin 8 Russia in the Global Forest Sector ..................................................................................185 Eduard L. Akim, Nikolay Burdin, Anatoly Petrov, and Leonid Akim Section III The Forest Sector within an Environmental Paradigm 9 Environmental Activism and the Global Forest Sector ..............................................203 Jacki Schirmer v vi Contents 10 Implementing Sustainability in the Global Forest Sector: Toward the Convergence of Public and Private Forest Policy .........................................................237 Timothy M. Smith, Sergio A. Molina Murillo, and Britta M. Anderson 11 Green Building and the Global Forest Sector ...............................................................261 Chris Knowles and Arijit Sinha 12 Assessment of Global Wood-Based Bioenergy ............................................................281 Francisco X. Aguilar, Michael A. Blazier, Janaki Alavalapati, and Pankaj Lal Section IV Capability Development and Strategic Imperatives for the Forest Sector 13 Current and Future Role of Information Technology in the Global Forest Sector ........................................................................................................................317 Taraneh Sowlati 14 Cross-Cultural Sales, Marketing, and Management Issues in the Global Forest Sector .........................................................................................................................341 Ernesto Wagner 15 Corporate Social Responsibility in the Global Forest Sector ....................................353 David Cohen, Anne-Hélène Mathey, Jeffrey Biggs, and Mark Boyland 16 Innovation in the Global Forest Sector ..........................................................................377 Scott Leavengood and Lyndall Bull 17 Strategic Orientations in the Global Forest Sector ......................................................405 Anne Toppinen, Minli Wan, and Katja Lähtinen Section V Bringing It All Together 18 What Now, Mr. Jones? Some Thoughts about Today’s Forest Sector and Tomorrow’s Great Leap Forward .....................................................................................431 Robert A. Kozak Index .............................................................................................................................................447 Preface The impetus for this book came from conversations between Rajat Panwar and Eric Hansen while Rajat was pursuing his PhD under Eric’s supervision at Oregon State University. It took several years before we began to refine our thoughts and convert them into a project plan. As we began to solidify the concept and talk with potential contribu- tors, Richard Vlosky with the Louisiana State University Agricultural Center joined the editorial team. Our overall goal in producing this book is twofold. First, we want to provide a means to support and advance teaching in forest sector business fields. Second, we want to con- solidate current knowledge on various business management themes in the forest sector that would be useful to established and emerging scholars, business managers, and pol- icy makers. Extant knowledge has largely remained dispersed across disparate academic sources albeit comprehensive books are available for specific functional areas such as for- est products marketing and competitive strategy. Thus, we identified a gap in the litera- ture that we believed was preventing students, scholars, policy makers, and others from developing a timely, structured, big-picture view of forest sector business. Furthermore, there was no single resource available for reviewing current thinking on a wide variety of business management issues in the forest sector. This gap looked even wider and deeper given the dramatic changes that have taken place in the global forest sector following the US housing crisis and global recession. How successful we have been in filling this gap is for the reader to judge, but we feel that this book is an important step toward the integra- tion and further development of the forest sector business field. The book is divided into five parts: Section I—Changing Context of the Global Forest Sector; Section II—Changes in Product Categories and Individual Markets; Section III—The Forest Sector within an Environmental Paradigm; Section IV—Capability Development and Strategic Imperatives for the Forest Sector; and Section V—Bringing It All Together. Each of these parts represents a separate theme within the book. Except for Section V, each part consists of several chapters. As a whole, the content provides a picture of the current and changing forest sector, including the state of forests, the nature of markets, the newly emerged patterns of stakeholder impact, and the evolution of key business practices. This book could be used to support an entire academic course on the nature of forest sector business. For example, at Oregon State University it will be used for a three- credit, graduate-level course entitled The Context of the Forest Sector, a required course for all wood science graduate students, and at Louisiana State University for all gradu- ate students in the forest products marketing program. Individual parts may be useful as supplemental readings for other courses at both graduate and undergraduate levels. For example, Section I could augment course content in global forestry and forest policy courses. Section II could fit in with forest products marketing courses. Section III could supplement a wide range of courses within forestry and support environmental stud- ies fields. Section IV may be relevant to courses in forest-based recreation and nontim- ber forest products areas. Individual chapters may be of interest to advanced, focused scholars. Finally, Section V should be of interest to anyone contemplating the future of the sector. vii viii Preface We anticipate that practitioners will also find this volume valuable. Sections III and IV, in particular, might further stimulate managerial thinking on various topics of practical application. Also, because the book captures concepts from a broad swath of the for- est industry, it can help business managers and policy makers to update their knowl- edge base, especially in areas in which they are less familiar or outside of their core responsibilities. Happy reading. Eric Hansen Rajat Panwar Richard Vlosky Acknowledgment Edited volumes such as this are successful to the extent they receive content from many scholars who are highly respected for their knowledge within their individual disciplines. We cannot thank enough each individual who contributed to the creation of this book. The support we received from colleagues, in fact, echoes the need for this book. In an ideal world, we would have liked to create a comprehensive book and title it “Forest products of the world, and the world of forest products,” but the innumerous topics, product cat- egories, and geographic areas that exist precluded their inclusion in this book. Whatever the reason for those omissions, we sincerely hope that colleagues and emerging scholars will find this book useful as a pedagogical tool—a basis to identify research areas and fill research gaps to make the discipline of forest products business management even more interesting, richer, and relevant to changing times. ix