The 2019 New York Declaration on Forests Progress Assessment has a stark key message: efforts to address the drivers of deforestation have been inadequate to meet global climate and biodiversity targets. Not enough is being done.
This year’s Progress Assessment finds that the global rate of tree cover loss has increased by 43 percent since 2014, when governments, business and civil society came together to urge greater action to end deforestation in the New York Declaration on Forests. Tropical forest loss accounts for more than 90 percent of global deforestation.
Most of this forest is being lost in Latin America — primarily in Brazil, Bolivia, Colombia and Peru — and also Indonesia where trees are being cleared to make way for agriculture. In Brazil, cattle pasture and soy are the major drivers. Deforestation rates are also increasing in West Africa, where palm oil is expanding.
A large part of the problem is growing global demand for meat, and for the soy used to manufacture protein-rich animal feed. Alongside this is the global market for palm oil — a highly efficient source of cheap vegetable oil, used in food and cosmetics, and also more controversially for biofuels.
Many of the companies involved in these supply chains — sourcing Brazilian beef for Chinese market, Paraguayan soy for European animal feed, or selling the baked and processed goods on supermarket shelves made with palm oil — recognise the problem and indeed many have made commitments to end deforestation in their own supply chains. But none of these companies have done enough to guarantee their supply chain is deforestation-free.
As the Progress Assessment highlights, sharing the findings from Global Canopy’s Forest 500 assessment for 2018, many of the commitments made by companies are too weak to be effective. And when it comes to taking action to address those commitments, just 50 of the 350 most influential companies in forest-risk supply chains are taking some kind of action across their supply chains. But none of the companies report adequately on what is being done.
A need for transparency
Without transparency, there can be no accountability. Which is why the Forest 500 assessment focuses on companies’ own published policies and commitments. Because companies need to be held accountable. And if a company cannot provide information about where it is sourcing from, it cannot demonstrate that its supply chains are deforestation free.
With tools such as Trase (Global Canopy’s joint supply chain transparency project with the Stockholm Environment Institute) and Global Forest Watch, supply chains are emerging out of obscurity. Buyers can now see if they are sourcing soy from an area where deforestation has been taking place, as in parts of the Brazilian Cerrado. And they can focus on the problems in their supply chain without having to invest in traceability for every ton of soy used in their animal feed.
A need for government action
Company action alone is clearly not enough — and was never expected to be. Governments are also signatories to the New York Declaration on Deforestation — but despite some impressive initiatives from France and Norway, governments in consumer countries have failed to do enough.
The Progress Assessment points to the success of legal measures in the European Union and United States in stemming the trade in illegally cleared timber. Opportunities exist to extend such measures to other commodities, to require companies to carry out due diligence on the forest-risk commodities in their supply chains. Consumer country governments need to act.
The report also carries one note of optimism — the rate of tropical forest loss in Indonesia has declined. Government action has played a part here with a moratorium imposed on palm oil developments on peatland. And consumer pressure, including from consumer governments may have also played a part. But it is also the case that also wetter weather helped reduce forest fires — a bonus, but not something which can be relied on to keep deforestation rates down.
A need to face the costs
One of the harsh realities behind growing deforestation is that in many parts of the world, deforestation pays — whether the profits go into the hands of the land speculators, or the palm oil multinationals.
And as the Progress Assessment notes, the finance that fuels that destruction has failed to step up to the challenge — allowing the planet to pay the price of their unsustainable business models.
The role of finance here is key. The Forest 500 assessment also looks at the policies of the 150 financial institutions who invest or lend to companies in forest risk supply chains. The 2018 assessment found that just 53 financial institutions had policies regarding their investments in companies in forest-risk supply chains. And even those institutions with policies continued to invest in companies exposed to forest risks.
And if private finance has been slow to shift to a sustainability agenda, public finance has been little better. The Progress Assessment finds that 15x more development finance is directed towards agriculture than is directed towards climate mitigation with a forestry objective.
Time is running out
As 2020 approaches, governments, companies and financial institutions need to up their game. It is time to shift to a climate-friendly approach to business — otherwise we will all pay the price.