Q&A: We're a Solution
The Future of Climate Policy, and How to Prepare for It
Spring 2022
Pictured: Dave Tenny, president and CEO of NAFO, and Andres Villegas, president and CEO of the Georgia Forestry Association
Dave Tenny, the founding president and CEO of NAFO, the National Alliance of Forest Owners, participated in a panel discussion at the Georgia Forestry Association’s Landowner Summit in January. The following is edited and condensed from his comments.
Q: What does NAFO do?
DT: We try and help policymakers understand that the markets that drive our products provide clean air, clean water, habitat and good-paying, real jobs. We want that to roll off the tongues of every single policymaker that has anything to do with anything that we care about. And so we advocate in a way that builds relevance. Relevance means that it’s not about what I want to tell you, it’s about what you want to hear, what you want to understand, what you want to know. And it’s about storytelling. We’re relevant with policymakers when our story is so compelling that they want to make it part of their own. And so we’re storytellers and we drive policy through that.
Q: How do we influence climate policy? And how can USDA help?
DT: What do people really know about NAFO’s contribution to climate change? We share our story with policymakers and their staff, key partners and influencers. And the response has always been the same: Wow, there’s a lot there we didn’t know. Take just three data points: 90% of the harvest-providing wood fiber in our country comes from forests that we all manage; those forests are providing 75% of all our forest carbon sequestration nationwide; and they’re providing more than half of all the carbon storage in our country. That’s an extraordinary story about how managed working forests are making a difference, and that is a wonderful place to start any kind of conversation on policy.
In the Obama administration, climate policy competed with healthcare. Healthcare won and climate policy took the second-place consolation prize and then really didn’t go very far. In the Biden administration, climate policy is on top and it’s going to remain there as the first priority of this administration. So that means every agency across the government is looking for their contribution to climate policy.
What is our number one objective? We’re a solution, so let’s keep a good thing going. Second objective, can we do more? Yes. We can do more with vibrant voluntary markets for trees. We want to build more with wood. Why wouldn’t we? We can innovate on wood. That’s a very useful thing that USDA can help foster and catalyze without stepping in the middle of the marketplace.
The USDA has recognized certification programs of things like bio-based products — acknowledging and even endorsing the good work of these programs. What about the registries that administer protocols for carbon content? USDA can do the same thing there — the same acknowledgement and the same endorsement that they’ve done to our certification programs — without having to step in the middle of them and recreate them. And they can invest in making those even more accessible to us so that we could use them more efficiently and effectively. Sometimes they’re overly complicated, sometimes there needs to be more flexibility. Sometimes there needs to be adjustments that make it frankly easier for us to engage in the marketplace using these tools. [They can do that] without sacrificing the rigor of what they’re providing as a carbon benefit. USDA can invest in engaging the landowners to identify those improvements and then get those improvements put in place in those protocols.
Q: What is Environmental, Social and Governance (ESG), and how does it impact us? (And what will the Securities and Exchange Commission (SEC) have to do with it?)
DT: Everybody knows what generally accepted accounting practices are. You have to pass an audit through your company. You know that there’s a set of rules that you have to follow in order to appropriately account for your financial performance, right? So we know how that works. ESG is the analogue of that for sustainability.
Environment — what impact are you having on the environment? Social — what impact are you having on your communities and social matters? Governance — how are you managing, how are you governing internally ways that are fair and equitable for employees or even the state? So ESG then becomes an analogue, and it’s not brand-new. It’s been around, and it’s evolving, and it’s becoming more relevant. Why do we know it’s becoming more relevant? Because 160 countries all agreed that there’s going to be ESG standards that have been applied globally at some point and a standard set of approaches so that everybody is speaking the common [language].
How does this impact us? If I’m reporting on my sustainability metrics like I would on my accounting metrics, and I’m determining what those metrics ought to be, and those metrics have anything to do with the environment, and I’m a publicly traded company that’s sourcing my packaging or my products that come from the land, then I’m going to have environmental metrics that are going to impact how I’m reporting on the sustainability of what I’m producing. You see how that comes our way pretty fast. That’s why it matters. And it creates opportunities and risks.
The biggest “E” out there right now is climate. There are also E metrics on water and E metrics on biodiversity. And they’re being developed now. Now is the time to start figuring out what the leaps and bounds are.
Who in the government will ultimately be responsible for all this? The SEC will be responsible for the standardization of these metrics. And that creates a federal nexus that will impact all of us. So what do we do with that? First, we understand what this is all about. Step number two is understanding how that is going to intersect the government and the SEC. And then making sure that we’re communicating with the Securities and Exchange Commission the right way so that when those metrics come out, they’re saying the right things about us. So that’s our task. ■
Q: What does NAFO do?
DT: We try and help policymakers understand that the markets that drive our products provide clean air, clean water, habitat and good-paying, real jobs. We want that to roll off the tongues of every single policymaker that has anything to do with anything that we care about. And so we advocate in a way that builds relevance. Relevance means that it’s not about what I want to tell you, it’s about what you want to hear, what you want to understand, what you want to know. And it’s about storytelling. We’re relevant with policymakers when our story is so compelling that they want to make it part of their own. And so we’re storytellers and we drive policy through that.
Q: How do we influence climate policy? And how can USDA help?
DT: What do people really know about NAFO’s contribution to climate change? We share our story with policymakers and their staff, key partners and influencers. And the response has always been the same: Wow, there’s a lot there we didn’t know. Take just three data points: 90% of the harvest-providing wood fiber in our country comes from forests that we all manage; those forests are providing 75% of all our forest carbon sequestration nationwide; and they’re providing more than half of all the carbon storage in our country. That’s an extraordinary story about how managed working forests are making a difference, and that is a wonderful place to start any kind of conversation on policy.
In the Obama administration, climate policy competed with healthcare. Healthcare won and climate policy took the second-place consolation prize and then really didn’t go very far. In the Biden administration, climate policy is on top and it’s going to remain there as the first priority of this administration. So that means every agency across the government is looking for their contribution to climate policy.
What is our number one objective? We’re a solution, so let’s keep a good thing going. Second objective, can we do more? Yes. We can do more with vibrant voluntary markets for trees. We want to build more with wood. Why wouldn’t we? We can innovate on wood. That’s a very useful thing that USDA can help foster and catalyze without stepping in the middle of the marketplace.
The USDA has recognized certification programs of things like bio-based products — acknowledging and even endorsing the good work of these programs. What about the registries that administer protocols for carbon content? USDA can do the same thing there — the same acknowledgement and the same endorsement that they’ve done to our certification programs — without having to step in the middle of them and recreate them. And they can invest in making those even more accessible to us so that we could use them more efficiently and effectively. Sometimes they’re overly complicated, sometimes there needs to be more flexibility. Sometimes there needs to be adjustments that make it frankly easier for us to engage in the marketplace using these tools. [They can do that] without sacrificing the rigor of what they’re providing as a carbon benefit. USDA can invest in engaging the landowners to identify those improvements and then get those improvements put in place in those protocols.
Q: What is Environmental, Social and Governance (ESG), and how does it impact us? (And what will the Securities and Exchange Commission (SEC) have to do with it?)
DT: Everybody knows what generally accepted accounting practices are. You have to pass an audit through your company. You know that there’s a set of rules that you have to follow in order to appropriately account for your financial performance, right? So we know how that works. ESG is the analogue of that for sustainability.
Environment — what impact are you having on the environment? Social — what impact are you having on your communities and social matters? Governance — how are you managing, how are you governing internally ways that are fair and equitable for employees or even the state? So ESG then becomes an analogue, and it’s not brand-new. It’s been around, and it’s evolving, and it’s becoming more relevant. Why do we know it’s becoming more relevant? Because 160 countries all agreed that there’s going to be ESG standards that have been applied globally at some point and a standard set of approaches so that everybody is speaking the common [language].
How does this impact us? If I’m reporting on my sustainability metrics like I would on my accounting metrics, and I’m determining what those metrics ought to be, and those metrics have anything to do with the environment, and I’m a publicly traded company that’s sourcing my packaging or my products that come from the land, then I’m going to have environmental metrics that are going to impact how I’m reporting on the sustainability of what I’m producing. You see how that comes our way pretty fast. That’s why it matters. And it creates opportunities and risks.
The biggest “E” out there right now is climate. There are also E metrics on water and E metrics on biodiversity. And they’re being developed now. Now is the time to start figuring out what the leaps and bounds are.
Who in the government will ultimately be responsible for all this? The SEC will be responsible for the standardization of these metrics. And that creates a federal nexus that will impact all of us. So what do we do with that? First, we understand what this is all about. Step number two is understanding how that is going to intersect the government and the SEC. And then making sure that we’re communicating with the Securities and Exchange Commission the right way so that when those metrics come out, they’re saying the right things about us. So that’s our task. ■
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