Barcelona - Global
companies that produce and use commodities such as palm oil and
soy are moving too slowly to cut deforestation, suggesting
international goals to protect forests will not be met, groups
that monitor business efforts said on Monday.
Agricultural products - including beef and paper - account
for over two thirds of tropical deforestation worldwide, said
the Global Canopy Programme.
Its third annual assessment - tracking the policies of 500
companies, governments and financial institutions that have the
most influence on tropical forests - suggests that ambitious
2020 and 2030 goals to protect those forests are unlikely to be
achieved.
"More needs to be done to increase the rate of change, and
uptake of these policies," said Tom Bregman, who manages the
"Forest 500" project. "You're not even getting to the policies
being in place, let alone implementation by 2020, so clearly
there is still a long way to go."
The 2014 New York Declaration on Forests set a goal to at
least halve the rate of loss of natural forests globally by
2020, and strive to end it by 2030.
The declaration also pledged to help the private sector
eliminate deforestation from the production of agricultural
commodities by 2020.
The results of the 2016 Forest 500 assessment show that 57
percent of the 250 companies tracked have either weak policies
or no policies at all to curb deforestation in their operations.
In the last three years, the number of companies with
policies to cut deforestation in the production of each
forest-related commodity they use increased by only 5 percent.
Read also: More work needed to stop deforestation
Bregman said that unless more companies apply such broad
policies, "you're not going to get to the holistic,
deforestation-free planet we desire".
Loopholes must be closed that displace deforestation to
places with less stringent regulations, and allow companies that
clear forests to sell to buyers without environmental standards,
the Global Canopy Programme said.
Supply chain risk
A separate report, also released on Monday, revealed that
multi-nationals such as Colgate-Palmolive, L'Oréal and
McDonald's depend on palm oil, soy, timber and beef products for
nearly a quarter of their revenues, on average.
That means up to $906 billion in annual turnover is at risk
for those companies listed on the stock exchange if the
commodities cannot be produced sustainably into the future.
CDP, which gathers data from companies on their actions to
combat climate change, said 72 percent of the 187 companies that
disclosed information on deforestation this year were confident
they would be able to source supplies securely and sustainably
in the future.
"But when you delve down into the responses and data, we
have reason to believe that this confidence could be misplaced,"
warned Katie McCoy, head of forests at CDP, formerly the Carbon
Disclosure Project.
For example, fewer than half of companies have evaluated how
the availability or quality of agricultural commodities will
impact their growth over the next five or more years, CDP said.
And only 30 percent can trace the commodities they produce or
use back to the point of origin.
CDP said the risks to business profits include the impacts
of climate change on the supply and price of commodities, the
potential tightening of regulation, and brand damage as scrutiny
of commodity-sourcing practices by media and citizens grows.
Some four-fifths of agricultural producers said they had
experienced substantial deforestation-linked problems in the
last five years, such as drought hitting beef production in
Brazil or consumer pressure for greener palm oil supply chains
in Southeast Asia.
"These supply chain impacts will increasingly be felt,"
McCoy told the Thomson Reuters Foundation. "Companies are not
really doing enough to manage those risks in a way that will
mean they will have (a) sustainable supply going into the
future."
The two groups urged investors and governments, in both
exporting and importing countries, to step up support for
companies to achieve deforestation-free supply chains.
"We do face an uphill battle if companies are left to do
this alone," said Bregman. "We need better market signals from
the finance sector as well as countries, on the demand side in
particular."
Some of the largest importers of soy, palm oil, timber and
cattle products - such as China and India, as well as European
countries and the United States - have yet to put in place
strong commitments to reduce deforestation linked to their use
of the products, said the Global Canopy Programme.
Meanwhile, only 3 percent of financial institutions assessed
in the Forest 500 have committed to remove deforestation
associated with all four commodities from their portfolios,
while a quarter have a lending or investment policy for some,
but not all, commodities, it added.