Traceability and its importance to support the reduction in deforestation

The Leather Working Group ESG certification is the most credible and comprehensive audit of leather manufacturers available today. The audit has been developed over 15 years in collaboration with brands, leather manufacturers and NGOs, and covers critical areas of leather manufacturing to drive compliance with appropriate environmental stewardship and governance.

The scope of the audit covers operating permits, sub-contracted operations, upstream leather manufacturing suppliers, environmental management systems, chemical management, restricted substance management, water and energy consumption targets, air and noise emissions, solid waste management, effluent treatment, health and safety, social compliance, and traceability. These are all crucial aspects to ensure the protection for both the environment and the people involved in the production of leather.

In terms of traceability and deforestation, the LWG has been working on improving traceability since its inception in 2005. We formalised this work in collaboration with Greenpeace and NWF in 2007/8 to improve traceability within the Brazilian sector agreeing on specific requirements that were added to the audit standard at that time. This requirement enabled brands to identify suppliers in Brazil that could define the exact location of slaughterhouses, and the date of slaughter, enabling direct farms to be identified. A major objective of this programme was to raise awareness of the concerns about deforestation within the leather supply chain in Brazil.

Improving traceability is a key priority of the LWG and the latest audit standard, P7, published in 2021, contains expanded requirements for traceability. There are 3 sections that address traceability: the assessment of the continuity of certification between manufacturers to incentivise improvements and adoption of LWG certification, as well as the assessment of both incoming and outgoing traceability.

In the Incoming Traceability section, the LWG audit scores manufacturers on their ability to trace their hides/skins, either physically or through documentation, to the slaughterhouse stage.  With an additional regional level recently being included to consider areas where informal slaughter is prevalent.

There are also additional requirements for hides that are sourced from Brazil and Paraguay. These work to ensure that suppliers are not involved in deforestation, invasion of indigenous lands and/or protected areas of the Amazon biome and Paraguayan Chaco biome. To achieve a score for this section, as a minimum, certified sites must provide a declaration of compliance. However, compliance through additional evidence, such as an IBAMA report and/or copy of evidence of compliance from meatpacker’s in-house monitoring system, and/or copy of report from a 3rd party monitoring service provider, is incentivised through the protocol scoring system. The scope of these traceability requirements has been developed and agreed with WWF and NWF, both of whom have significant projects and experience on the ground in Brazil, working to reduce deforestation over the past 15 years.

The LWG audit is constantly evolving, with incremental changes being made that ensure requirements are realistic and achievable for the majority. The same is true for the newly developed traceability requirements. With the 2-year audit cycle, these will take time to be adopted by all, with the next stage of requirements being adopted in-line with the future version of the LWG Audit Standard, P8. In this way, we drive continuous improvement, and maintain the engagement of the LWG certified leather manufacturers.

Deforestation is a special focus area, and LWGs vision for the future is for a 100% deforestation and conversion free leather. LWG value the expert advice from our partner organisations NWF & WWF to help drive this change.  LWG welcomed both WWF and NWF as members in 2021 in recognition of the value of these partnerships. 

Issues related to deforestation are complex, and the journey to address these will take time and need both realistic and achievable goals with cross sector collaboration. To further this agenda, the LWG has agreed new projects with NWF and WWF to further develop transparency and traceability on the ground. We are also in discussions with the Consumer Goods Forum beef working group with the intention to collaborate and share data between the sectors to augment the LWG’s existing data and further industry progress to enforce deforestation commitments.

The LWG works in partnership with brands who are encouraged to maintain and implement their own due diligence and risk assessments of their supply chain partners to assess what level of certification has been achieved.  LWG certification is proof of comprehensive auditing at the leather manufacturing stage.  We provide specific guidance on what claims can be made related to the meaning of LWG membership for brands and the level of commitment this demonstrates in improving the social and environmental impacts of leather production. 

Further to this, we are also now working to develop chain of custody requirements beyond the leather manufacturing stage.  This will enable additional supply chain transparency, which will allow for fur due diligence measures where any risk is identified. This will be developed in line with the LWG Traceability Roadmap, which will be published in early 2022. 

We are engaged with stakeholders across the leather and beef sector with particular focus on South America, working in partnership to develop deforestation and conversion free certification as a crucial incremental step for the leather industry.  The LWG values collaborations and open dialogue with all stakeholders that share these objectives to work to eradicate all forms of deforestation.

Please reach out to us for more information.