Revealed: paper giant 'linked to Indonesian forest trashing' targeted activists

| 30th March 2011
Sumatran forest

Destroying Sumatran rainforest to make way for APP pulpwood plantations. Photo: Jeremy Sutton-Hibbert/Greenpeace

A little-reported legal battle in Italy between paper company Pigna and eco-activists from Terra! is leading to fears that it may open the way for big companies to muzzle legitimate environmental protests. Mandy Haggith reports

An international solidarity campaign is gaining momentum to support the small Italian environmental group - Terra! - which recently lost a court case brought against it by Cartiere Paolo Pigna. Pigna is a household name in Italy as a stationery brand associated with school exercise books, and the core of its business is ‘paper conversion’, turning low-value pulp into high-value household and office products.

In April 2010 Terra! produced a report of research alleging that Pigna sells paper made from rainforests in Indonesia, and in particular that they source products from the controversial company Asia Pulp and Paper (APP). After a banner action on Pigna’s building in Rome, the company sued Terra! for slander and damage to their corporate reputation, and won. The court found that although the substance of Terra!’s campaign was valid, the wording of their banner was not. Campaigners believe that this ruling is a travesty of justice, and are concerned about the circumstances of the trial.

In the court case, which was made public in January 2011, the judge found that Terra!’s report is not libellous, and that Pigna does indeed source some of its paper products from APP. He accepted evidence that Pigna has a commercial relationship with APP, which was demonstrated by copies of trade invoices that Terra! had obtained for six transactions during 2009.

Nonetheless he upheld the complaint about a banner stating that Pigna’s products come from deforestation, and decided that the banner was worded in a way that did damage to Pigna’s reputation. He ruled that Terra! should pay a fine of €20,000 and a further €7000 of legal expenses. To a tiny organisation like Terra!, whose total annual budget is only about €60,000, staffed by a team of just three staff plus volunteers, this is a crippling sum, easily high enough to shut them down.

David and Goliath

Like many small campaigning bodies, Terra! punches above its weight, and in true David and Goliath style, it has proved a worthy adversary of its big corporate target. In 2010, Pigna wrote to Italian newspapers saying, ‘Cartiere Pigna has no business with the Indonesian company Asian Pulp and Paper and doesn’t source products coming from Indonesian forests’. Despite their legal setback, Terra! has shown, they claim, that this is not true.

The question is not whether Pigna buys and sells APP products, but whether these are the products of forest destruction. To environmentalists, the link between APP and deforestation is well proven, and Terra!’s report was based on hard evidence, which they say the judge overlooked.

Sergio Baffoni, Terra!’s forest campaigner, said, ‘The judge surprisingly didn’t take into account the report by IPS Testing, which was submitted to the court ahead of time, and demonstrates clearly that Pigna's exercise books contain a large amount of fibres linked to deforestation in Southeast Asia.’

IPS is an independent fibre testing company in the USA, which analysed samples of four ‘Pigna Monocromo’ exercise books for Terra! The analysis showed that they all contained fibres from acacia Magnum, a species grown in plantations, the establishment of which is Indonesia’s primary cause of deforestation. In addition, in each sample up to 36 per cent of the fibres were a mixture of tropical hardwoods, including Myristicaceae and Dipterocarpaceae species, typical of rainforest clearance. Helpfully, two of the exercise books have ‘Made in Indonesia’ on their covers.

Sergio Baffoni said, ‘Doing business with APP supports the further expansion of its operations into Indonesia’s last tropical forests and peatlands, threatening biodiversity and impacting the livelihoods and the rights of indigenous and traditional communities.’


More than 50 environmental organisations have come together from around the world to protest the court decision and help Terra! to raise the money for the fine. A letter of solidarity has been organised by the European Environmental Paper Network, an umbrella grouping of environmental and human rights organisations concerned about the impacts of the paper industry. The network’s co-ordinator, Daniel Hausknost, said, ‘We will not let this case rest in the quiet of the courtroom. The decision is outrageous. There is really no controversy about APP’s link to deforestation, it is so well documented.’

Pat Venditti, who leads Greenpeace’s forest campaign, said, ‘APP are Indonesia’s most notorious forest destroyer and Terra! were absolutely right to expose the role of consumer companies who are still prepared to do business with them. It makes no sense at all that Terra! should be prosecuted for this action and we’ll be supporting them in dealing with the outcomes of this case and in continuing to fight against the irresponsible practices of APP.’

There are deep concerns among environmental campaigners that APP will encourage its customer companies to use legal means to silence any organisation that criticises them.  Daniel Hausknost said, ‘We cannot allow a paper company to try to kill off our member organisations for pointing out that they are purchasing the products of forest destruction. APP is seeking to aggressively expand its market in Europe and one of our worries is that they will seek more gagging-orders against NGOs.’

In August 2010, a large coalition of environmental organisations began to push European paper companies not to purchase any products from APP because of the companies link to deforestation and human rights abuses. They claim that APP and its fibre suppliers are the single largest source of rainforest destruction in Sumatra, Indonesia, and are pushing three highly endangered species – the Sumatran tiger, elephant and orang-utan – closer to extinction.

Forest destruction

Sumatra has one of the fastest rates of deforestation in the world, and there are many cases on the island of local and indigenous communities who claim that their forest lands have been taken over by APP and its fibre suppliers without their prior and informed consent.

As well as claims over the destruction of biodiversity and human rights abuses, the environmentalists’ concerns about APP’s forestry practices include climate change. Much of Indonesia's rainforest grows on carbon-rich peatlands and when it is cleared, ploughed and drained to create plantations, huge quantities of greenhouse gases are released. This is a major reason why Indonesia is the world's third largest global greenhouse gas emitter, behind the USA and China. 



Baffoni believes that there are reasons to be sceptical about the court case procedure and personnel. Senior staff of Pigna reportedly have political connections with the Italian leader Silvio Berlusconi: Pigna's chief executive, Giorgio Jannone, is a Member of Parliament in Prime Minister Berlusconi’s party, People of Freedom.

The company’s lawyer is Vittorio Dotti, formerly a powerful player in Berlusconi’s political elite who has been associated with a trial involving Berlusconi’s allegedly fraudulent trading of TV film rights, and with the case of ex-cabinet minister Tessa Jowell’s estranged husband, David Mills, who was convicted of perjury in 2009, after being accused of accepting $600,000 as a reward for withholding court testimony to help Berlusconi.
The campaigners believe that Bergamo, where Pigna is so closely involved in the tight-knit political elite, was not a fair or independent location for the court case. ‘Instead of being in the city where the "crime" was supposedly committed – Rome, the case was heard in Bergamo, where Giorgio Jannone is a prominent political personality’, said Baffoni. ‘All this might not mean anything, nor prove anything, but surely Bergamo was not a neutral location.’ He believes that suing Terra! was ‘an attempt to prevent environmental campaigning’.


Terra! will seek to have the ruling overturned and are making a formal appeal, which if due process is followed will require an independent judge and location, but the organisation will struggle to cover the costs and the process is likely to be very slow. Baffoni said, ‘Of course we have asked for revision, and are nearly sure to win, but it will take quite some time, maybe years.’

Pigna have declined to make any comment on the case. This exemplifies Baffoni’s frustration, which is not just with their conviction in court, but more generally the difficulty of communicating with Pigna. Before Terra! resorted to stringing a banner outside Pigna’s office building in Rome, they tried hard to negotiate with the company. Baffoni can show how they sent numerous registered letters and emails to Pigna between January and April 2010, pointing out the problems with their commercial relationship with APP and asking them to stop buying their products. They received no reply. If companies will not respond to written communication and will sue against direct action, what chance is there for meaningful dialogue towards a more sustainable paper industry in Europe?

The Ecologist attempted to contact Pigna but were unable to secure a response. 

In a detailed statement however APP disputed the claims of activists:  'Far from being a "forest destroyer", APP has recently underlined its commitment to sustainable forest management and explained the true facts about the pulp and paper in Indonesia. To this end, we are proud signatories of the Rio Forest Declaration,' Aida Greenbury, Managing Director of Sustainability & Stakeholder Relations, said.

The company also denied attempting to stifle environmental voices: 'APP does not use "legal means" – directly or indirectly - to "silence any organisation that criticises" us. We believe in an open debate on these important issues, which is based on verifiable facts and science. Unfortunately, it seems that some NGOs do not believe in freedom of speech and wish to restrict APP’s ability to put across its point of view.'

APP claims too that it is supporting wildlife projects: 'APP has invested millions of dollars in programmes to protect the Sumatran tiger, the orang-utan and other wildlife. We recently announced a new initiative with the Sumatran Tiger Preservation Foundation.'

It also hit back at campaigners' attempts to link its operations with climate change.

'The Indonesian Government’s Second National Communication – a formal report on the state of Indonesia’s emissions - was submitted to the UN in November 2009. The report, supported by the United Nations Development Programme, refuted a World Bank study that cited Indonesia as the world’s third largest emitter. It stated that Indonesia’s GHG emissions in 2000 were less than half than the number reported by the World Bank,' Greenbury said. APP also pointed to research it said concluded that deforestation accounts for only '6 to 8 percent of global emissions', a figure that it claims decreases further after forest regrowth is considered.

Despite such claims, there are many companies who have appeared to  respond to the environmental community’s concerns about APP. Around the world, corporate paper buyers have concluded that APP's environmentally destructive practices are incompatible with their own corporate values and have ceased purchasing APP products.

These include: Staples (USA); Idisa Papel (Spain); Metro Group (Germany); Woolworths (Australia); Robert Horne Group (UK); Ricoh and Fuji Xerox (Japan); Unisource (USA); Gucci and Versace (Italy). Carrefour (France) and Tesco (UK) have confirmed that they will stop buying from APP for their own-brand products.

This approach by big paper buyers is seen as crucial by campaigners because end consumers rarely have the opportunity to choose what kind of paper will be used in the products they buy: consumers don’t buy books and magazines based on what kind of paper they are printed on, so they need paper buyers to make the right choices on our behalf. Pigna’s, it would seem, didn’t.

Useful Links:

Terra! Pigna campaign

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