Market Benefits of Chain of Custody Certification

Abstract

Japan grants the largest number of chain of custody certificates outside Europe and North America. Certified companies may receive market benefits from their own certification and certified products. In this study, we examined the benefits of chain of custody certification in the forest products market in Japan. A nationwide survey was conducted from October to December 2005 of 132 companies that had obtained a chain of custody certificate from one of the certifying bodies operating in Japan: the Forest Stewardship Council (FSC), the Programme for the Endorsement of Forest Certification schemes (PEFC), or the Sustainable Green Ecosystem Council (SGEC). In the mailed questionnaire, respondents were asked if they received any premium from their certified products. The perceived level of benefits gained from a chain of custody certification was also measured using a 5-point scale. Results indicated that it was not possible for most Japanese companies to receive premium prices for certified forest products. Factor analysis determined three benefit dimensions: (1) business performance, (2) customer relations, and (3) environmental communication. The mean benefit rating of environmental communication was the highest, followed by customer relations. Business performance was rated significantly lower than the other two dimensions. Paper products companies, as well as large companies (≥ 300 employees), received relatively high benefits from certification.