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Australia's biggest wood-chipping company adm -

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LEIGH SALES, PRESENTER: In July, 7.30 had a story about thousands of koalas facing injury or death due to the logging of vast tracts of bluegum timber in south eastern Australia.

The report named the country's largest woodchip exporter, Australian Bluegum Plantations. The company ridiculed the suggestion that koalas were under threat, but since then, it's being slammed in an environment audit and forced into a public admission that it has injured and killed koalas.

Greg Hoy reports, and a warning this story contains some disturbing images.

GREG HOY, REPORTER: After the logging machines have left, this is what's left behind.

This lucky koalas survived, but their habitat is gone. Confused, expose and stressed, their health is deteriorating.

Wildlife carers are keen to catch them to check for injuries, nurse them back to full strength and try to relocate them.

It's a sadly familiar story across the vast bluegum plantations of south west Victoria and South Australia.

TRACEY WILSON, WILDLIFE CARER: I think we're facing a crisis with these guys.

Broken limbs, impact wounds, broken backs, severed arm. Dead mothers with joeys that are still alive, trying to survive.

It's a huge issue.

GREG HOY: When 7.30 exposed this issue in July, we noted many companies were involved, but singled out the biggest: Australian Bluegum Plantations. Each year ABP ships 2 two million tonnes of bluegum woodchip to pulp and paper manufacturers in Japan and China.

(to Tracey Wilson)

Have you had animals from Australian Bluegum Plantations?

TRACEY WILSON: Yes. That one out in the tree; It's from Australian Bluegum Plantations.

GREG HOY: And, do they know that you've had animals from Australian Bluegum Plantations?


GREG HOY: They know?


GREG HOY: For this poor fellow, who's missing both an arm and a leg, it was obviously a slow and painful end. But, the lingering problem for the Forest Stewardship Council, and for the environmental auditor for this company, The Rainforest Alliance, is that FSC certification is meant to pledge that companies like Australian Bluegum Plantations will guarantee that all wildlife is vigorously protected.

Following our report in July, Australian Bluegum Plantations issued a blanket denial through the Forest Stewardship Council.

EXCERPT FROM FSC VIDEO: When you choose an FSC product you are contributing to a positive change in the world.

GREG HOY: The chairman of the Forest Stewardship Council at the time was the chief executive of Australian Bluegum Plantations, Tony Price.

TONY PRICE, AUSTRALIAN BLUEGUM PLANTATIONS: At that time, our harvesting operations and the procedures we were operating under, from our perspective, we felt we were delivering the outcomes we were looking for and that is to avoid harming koalas.

GREG HOY: As complaints against his company flooded in following our report, international environmental auditors, the Rainbow Alliance, launched an investigation into ABP and 7.30's claims.

ANITA NEVILLE, RAINFOREST ALLIANCE AUDITORS: We felt the program's essence was serious enough and the feedback that we got from various stakeholders was serious enough that it warranted that immediate field investigation.

GREG HOY: The investigation's report has now been published; it's damning of Australian Bluegum Plantations.

(Excerpt from Rainforest Alliance report)

"Given the numbers of koalas that continue to be injured, killed or found in poor health (suffering from pneumonia due to exposure) APB is not taking sufficient steps to recognise the extent of the issue and address the issue."

ANITA NEVILLE: Across six areas, the Australian Bluegum Plantations were found to have what we call major non-conformances. So these are significant failures in their management systems related specifically to how they manage wildlife on their operations.

GREG HOY: Australian Bluegum Plantations's FSC certification has been suspended. It's a significant blow.

ANITA NEVILLE: Really FSC certification is almost becoming an essential in the forestry industry in order to do business.

GREG HOY: The company's logging operations in vast koala habitats across south eastern Australia have also been suspended.

(to Tony Price)

Do you feel any guilt that it's taken this long, that it's taken for you to be forced to take action? Do you feel any guilt about the numbers of koalas that have been injured or killed in that time?

TONY PRICE: If I could just take you back to ...

GREG HOY: It's a simple question, though. Do you feel any guilt about the...

TONY PRICE: Of course I do; we're deeply sorry for the fact that koalas have been harmed on our property. Deeply sorry.We're very, very keen to make sure that, going forward, we do everything we possibly can as a business to avoid harming koalas.

GREG HOY: Last year, ABP was named the Forest Certification Council's Australian Forest Manager of the Year.

(to Tony Price)

So, have you written to complained to those who complained to the Forest Certification Council and to your company about the sort of problems that were problems that were presented in our program?

TONY PRICE: We responded to a number of emails that we had at the time.

GREG HOY: Yes, denying any involvement. Have you written to those people since to correct the record?

TONY PRICE: No, I haven't.

GREG HOY: Should you?

TONY PRICE: I believe I should.

GREG HOY: Though he's resigned as chairman, inexplicably, Tony Price remains a director on the FSC board.

(to Tony Price)
Having been found guilty of such serious breaches, do you not think it would be fair to step down as one of the leaders of the Forest Stewardship Council?

TONY PRICE: I come back to the point. We are focused on addressing some findings in an audit that we've just had, and our intention would be to get those things closed out, those corrective actions closed out, get them signed off by the auditor and then have our certification reinstated.

GREG HOY: As auditors are paid by the forestry companies they inspect, wildlife carers fear penalties won't be either tough enough or imposed frequently enough to deter ongoing mistreatment of koalas, and they'll be left trying to clean up the mess.

LEIGH SALES: Greg Hoy reporting.