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Under what conditions do private forest governance standards influence state policy and behavior to become more oriented toward sustainability? We argue that governance schemes targeting firms may indirectly shape state behavior, even when designed to bypass state regulation. Through an examination of the Forest Stewardship Council (FSC) in Russia and Brazil, we find that the FSC has influenced domestic rhetoric, laws, and enforcement practices. FSC has had a more disruptive and consequential impact on Russia’s domestic forest governance; in Brazil, earlier transnational environmental campaigns had already begun to shift domestic institutions toward sustainability. Based on interview data and textual analysis of FSC and government documents, we identify the mechanisms of indirect FSC influence on states—professionalization, civil society mobilization, firm lobbying, and international market pressure, and argue that they are likely to be activated under conditions of poor and decentralized governance, overlapping and competing regulations and high foreign market demand for exports.
