Home Depot and the Endangered Forests of Patagonia

Ancient forests in South America…Home Depot…environmental groups protest. It may sound like a Hollywood script about the timber battles of the 1990s, but unfortunately it describes the players in the latest chapter in the ongoing battle to protect remaining endangered forests in the world.
In the heart of the Patagonia region of Chile, the multinational consortium of financiers, HidroAysén, is proposing to build five hydroelectric dams on the Pascua and Baker Rivers. The dams, if built, would flood two pristine rivers and nearly 11,000 acres of Chile’s most biologically rich forest, agricultural and ranching lands. Included in this area would be some of the world’s rarest forest types and the habitat of a critically endangered species – the huemul deer, a Chilean national symbol.
Beyond the direct impact of the dams, the dams’ transmission lines would require clear-cutting forested areas for at least a thousand miles. The route would traverse 64 Chilean communas, including some indigenous communities, and would damage fourteen areas that have been granted protected status under Chilean law because of their unique environmental values and vulnerabilities.
Most Chileans oppose these plans. Over 30 Chilean governmental agencies have joined Chile’s forestry agency in publicly expressing strong concern about the potential environmental and social impacts of the plans – and many of them have called for the outright rejection of HidroAysén’s inferior environmental study.
In response, a group of Chilean and American environmental organizations including International Rivers, Friends of the Earth, ForestEthics, Rainforest Action Network, Environmental Defense, Sierra Club, Natural Resources Defense Council and Pacific Environment, have been fighting the dams for many years. The campaign has included the usual tactics employed by the environmental community over the years, but this year they have begun to put pressure on the network of companies that are both directly involved and indirectly implicated by the project.
One of those relationships includes Home Depot. CMPC and Arauco are two Chilean timber companies that play a pivotal role in the project consortium. They also happen to be suppliers of wood products to Home Depot – in fact, the company is by far the largest source of sales for the two companies.
Now you may be saying to yourself, didn’t we already cross this bridge with Home Depot years ago? And you would be right. In 1999, as part of a broad settlement involving a number of organizations including Trillium Asset Management Corporation (“Trillium”), Home Depot committed to eliminate the purchase of wood and wood products from endangered regions around the world by year-end 2002.
In 2003 as a part of that process, CMPC, Arauco and Home Depot made widely publicized, written commitments to protect Chilean forests. In that agreement, Home Depot committed “to provide for the protection of native forests in Chile.”
Trillium, in cooperation with a group of other shareholders, is leading an engagement with Home Depot focused on Home Depot’s commitments to protect the native forests of Chile. Home Depot’s relationships with the timber companies offer an important leverage point that can add to the growing pressure on the proposed dams.
The situation also presents serious reputation risk to the company. Not only have some of the best-known environmental groups come out publicly and forcefully in calling attention to Home Depot’s relationship with the proposed dams, but in the past sixty days more than 5,000 customers have written to the company to say they will no longer shop at Home Depot because of the proposed dams controversy.
For both of these reasons we believe that Home Depot must take a positive, meaningful and public stand against these proposed dams.