The company, Asia Pulp and Paper (APP), announced its new conservation policy after clearing nearly 5 million acres of Indonesian tropical forest since 1994.
Areas felled included key habitats for the country’s dwindling tiger and orangutan populations.
The move came as a result of a long campaign headed by Greenpeace and other activist groups.
They convinced many of APP’s most important customers, such as KFC, Pizza Hut, Xerox and Lego, to stop buying its products while the deforestation continued.
The paper giant's new policy involves harvesting only from tree farms. It says any suppliers who don't comply with the new rules will have their accounts suspended.
APP Chairman Teguh Wijaya urges others in the industry to follow his company’s lead.
Greenpeace has publicly stated its campaign is over for now but stresses it is keeping a watchful eye on APP's moves.
Scott Poynton, leader of the Tropical Forest Trust, a nongovernment organization that helped organize the deal with Asian Pulp and Paper, was more optimistic.
He said: “If the third-largest paper company in the world can commit to forest preservation — despite the complex social, political, economic and environmental challenges they have to navigate to do so — then any company can do it."