Presentation by Zhang Junzuo (CCCMC) for the Second Regional Land Forum, 2018

1. Promoting Sustainable Business Practices in the
Rubber Supply Chain --- The Code of Conduct
Junzuo Zhang
On behalf of CCCMC (China Chamber of Commerce of Metals
Minerals & Chemicals Imports & Exports)
May 28-30 2018
AVANI Riverside Bangkok
CCCMC
For
Second Regional Land Forum

2.  The framework of the rubber guide
 CCCMC’s motivation in developing
the guide
 Chinese companies’ incentive to
use the guide
 Next steps to move forward
China initiative
CCCMC
Guide for Sustainable Natural Rubber

3. International Forest Investment and Trade Programme (InFIT)
Objective
Support China to address the potential negative impacts from
increased demand for timber and overseas investment in timber and
other commodities
An initiative between China’s SFA, MofCom and the UK’ DFID.
Outcome
Alignment of UK’s and China’s policies on timber trade with
developing countries and investment in production of commodities

4.  China’s demand for natural resources has
grown dramatically since 2000
 Between 2001 and 2016 the value of imports of
timber, palm oil, rubber, soy and beef grew
221%
 China’s share in total world trade in these
commodities increased from 10.6% to 30.1%
 China’s overseas forestry investments in Africa
grew from US$ 8 million to US$ 84 million
between 2007 and 2015 in 25 African countries
Source: FGMC

5. The framework of the rubber guide
CCCMC

6. CCCMC
6 Guiding
Principles
Legal compliance and lawful business
operations
Respect for human rights and secured
rights and interests
Open and transparent
Site-specific considerations with respect for
differences
Green and environmental protection and
ecological benefits
Innovative development, inclusion and
sharing

7.  Due Diligence
Policy
 Management
framework
 Stakeholder
collaboration
 Background
assessment
 Risk
identification
 Coordinated
management
 Responsive
actions
 Tracking
 Evaluation
 Progress
reporting
DDS as
company
policy
Risk
identification &
assessment
Risk
prevention &
mitigation
Effectiveness
tracking &
reporting
Due
Diligence
Approach
CCCMC

8. Pre-
investment
Business
operation
Risk
assessment
& Prevention
Identifying risks
& requirements
for how the
risks should be
prevented or
mitigated.
Prevention
&
Mitigation

9. CCCMC
Mar 2016, Singapore
Jul 2016, UK
May 2017,
Yunnan
Nov 2016, Myanmar
Oct 2016, Yunnan
Jul 2017, Beijing
Jul 2017, Switzerland
Sep 2017, Italy
Oct 2017, Vietnam
Nov 2017,
Laos
Nov 2017,
Hainan
CCCMC

10. CCCMC’s motivation in developing
the guide
Chinese companies’ incentive to
use the guide
CCCMC

11. CCCMC
• The guiding principles are mutually
supportive and reinforcing to the China
policy towards regulating overseas
investment direction
• It’s important to establish a long-term and
stable investment relationships, the
imperative for China to retain its market
share of the world market.

12. • Helps identify & assess investment
risks
• Guides risk prevention & management
• Supports stakeholder collaboration &
communication
 Within the company
 With community stakeholders
 With supply chain partners
 With financial supporters
 With host country governments
CCCMC

13. • Low awareness and need for capacity building
• Weak transparency and accountability systems lead to
abuses along the supply chain
• Lack or exclusion of stakeholders in decision making
and esp. community engagement
• Difficulty in monitoring of business management
operations.
• Lack of effective oversight and complaints management
mechanism as well as tracking system
CCCMC

14. Next steps to move forward
CCCMC

15. Industry
platform
 Co-launch a collaboration platform
to drive positive change;
 constitute industry-wide
partnership and approach;
 develop and test the feasibility and
efficiency of a collaborative
approach;
 improve the governance capacity
of supply chain companies.
UPSTREAM
DOWNSTREAM
CCCMC

16. Company
 Develop and test the
implementation process for
companies’ rubber supply chain
due diligence systems;
 Select at least one rubber sourcing
supply country to pilot a capacity
building programme
 Demonstrate business leadership
and engagement
Pilot
CCCMC

17. • China has a shared responsibility to address
environmental degradation in forest rich countries
• Legal and responsible trade and investments can
provide incentives to raise standards at home and
abroad
• Positive change can occur through inclusive stakeholder
engagement, incentives and shared understanding from
government, private sector and civil society leading to
action
FGMC
Conclusion

18. Thank you!
Welcome feedback!
Please send your feedback to:
Project Secretariat : Ms. Huichun Zhang, CCCMC
Email: rbc@cccmc.org.cn
E- copy of the Guidance:
http://www.cccmc.org.cn/tzgg/72550.htm
CCCMC