The shareholders of
Forests for Friends Ltd are
co-owners of land and trees. They participate in all the plantations and in all the years. This increases the flexibility of the company to maintain the plantations in an optimal manner. The plantations can be maintained on various levels of intensity: some soils are more adequate for teak than others and the maintenance can be concentrated there, where we expect the bigger return. This has a positive influence on the costs and on the overall profitability.
The two business aspects are separate: Forests for Friends Panamá owns the plantations, whereas the maintenance has been outsourced to an experienced enterprise.
The shareholders decide on the distribution of the revenues, they agree to the annual financial statements, and they elect the members of the Board.
An important advantage for the shareholder is risk distribution. He is
not bounded to a particular plantation or an individual year in good times and in bad times. He
participates in all plantations, which lie hundreds of kilometres apart.
As we have neither marketing nor telephone-trading costs, we are only paying
for about 1.0 full-time positions with a lean administration structure. Legal advice, accounting, and management of the share register are outsourced.