New Forest Trends report: 'More efforts needed to cut deforestation out of commodity supply chains'

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New Forest Trends report: 'More efforts needed to cut deforestation out of commodity supply chains'

Forest Trends has released a new report - downloadable here - aimed to track progress on 579 public commitments from companies around the world who have pledged to remove forest destruction from their supply chains.

These businesses depend on the “big four” agricultural commodities – palm oil, wood products, soy, and cattle – responsible for more than a third of tropical deforestation each year.

The report 'Supply Change: Tracking Corporate Commitments to Deforestation-free Supply Chains, 2016' looks at 566 companies representing at least US$7.3 trillion in market capitalization who were identified as having deforestation risk tied to these four commodities within their supply chains. Of these companies, 366 have made coinciding commitments to shift to sustainable sources.

Key findings include:

• Companies are most likely to make commitments toward palm, and timber & pulp. Of companies active in palm, 61% have adopted pledges, compared with only 15% and 19% of those companies active in cattle and soy, respectively. The disparity is alarming because it is estimated that cattle production causes 10 times more deforestation than palm.

• Large public companies are more likely to make commitments than small private ones, possibly as a result of pressure and higher standards for disclosure from financial institutions. Many of these large companies are consumer-facing entities headquartered in North America and Europe, far away from the environmental damage caused by commodity agriculture.

• Companies that operate “upstream” (producers, processors, and traders) are more likely to make commitments than their “downstream” counterparts (manufacturers and retailers) – and their pledges are potentially more impactful. Upstream actors represent just 26% of tracked companies, but 80% have made a commitment, compared with 62% of downstream companies.

• Current disclosure is insufficient as companies have only reported quantifiable progress toward one in three commitments. Even among pledges whose target dates have already passed, companies have disclosed progress on fewer than half.

"We applaud the hundreds of companies that have publicly made a commitment to reducing deforestation in their supply chains. However, this is only the starting point", commented Forest Trends Association President Michael Jenkins.

"We encourage all companies to update their stakeholders on their progress along the way and the hundreds of other companies that have not yet made a commitment to doing so. We hope that this report helps to inform stakeholder decisions and advance the transition to deforestation-free supply chains", Mr Jenkins concluded.


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