Global Canopy is an environmental nonprofit that targets the market forces driving two-thirds of tropical deforestation worldwide — and it has some disappointing news. The group’s annual Forest 500 report indicates that most companies are failing to address tropical deforestation along their supply chains – despite high-profile zero-deforestation commitments.
“Despite some companies setting strong commitments, deforestation rates have actually increased,” Sarah Rogerson, a researcher at Global Canopy and author of the report, told TriplePundit. “Companies with commitments are let down by a lack of action by their suppliers or peers continuing to drive deforestation.”
Public commitments sorely lacking across the global business community, nonprofit says
Of the leading 500 companies trading and financing the top commodities connected to tropical deforestation, 242 have yet to make any public commitments, according to the report. This includes some big-name brands, such as the retailers Amazon and TJ Maxx, food giant Tyson Foods, and luggage manufacturer Samsonite.
Of the companies that have made public commitments, action is often lacking. Global Canopy found that some companies have even removed or weakened their commitments, such as Burger King, whose palm oil commitment now only applies to the United States. Another 100 companies do not report on implementation or progress, making it difficult to access if the commitment has resulted in any actual change, according to the report.
In reality, the findings are not too surprising, as last year saw two tropical forest disasters that can be directly connected to global supply chains.
Deforestation wreaking havoc on communities, the environment and the global economy
First, fires in Indonesia charred an estimated 1.6 million hectares. Greenpeace connected several of the fires to palm oil plantations supplying some of the world’s largest food and consumer packaged goods companies. This is nothing new, as palm oil is a crop that has long been connected to deforestation, biodiversity loss and labor violations.
Then came an even worse catastrophe: Massive fires in the world’s largest rainforest, the Amazon, burned an astounding 12 million hectares. This time environmental watchdogs traced the fires to commodities including beef and soy, with the U.S. financial firm BlackRock facing particular scrutiny for its role as an investor in several forest-clearing companies. The nonprofit Amazon Watch linked a slew of corporate supply chains to the fires, from sectors such as banking, retail and food.
“Corporations are ignoring what is going on in the Amazon,” said Moira Birss, campaign director of the finance program at Amazon Watch. There is some hope, however, in BlackRock’s recent move to put climate at the center of some of its investments.
Here’s the problem: Blackrock’s recent moves sound good and generated a lot of positive press, but how impactful will they really be? The core issue that Global Canopy has identified is that voluntary commitments are just not working, as it is too easy for companies to back out at any time, quietly change their goals, or just fail behind the scenes.
Fixing that will take time, but the first step is more transparency, Rogerson says.
“As a minimum, we want companies to acknowledge their role in driving demand for commodities causing deforestation, and set a commitment to eliminate the deforestation associated with the products they produce or use,” Rogerson told 3p. “These commitments should be public, ambitious, and must be implemented and reported against transparently.”
The nonprofit is also calling for due-diligence legislation that would require companies to assess, prevent, mitigate and report on deforestation risks in their supply chains. Such legislation is now under consideration in the European Union.
“Legislative action would require the laggard companies to act on deforestation,” Rogerson explained. “Leading companies should back this as it would increase demand for deforestation-free commodities, making it easier for companies to meet their own commitments.”
We’re at a point where legal repercussions for companies that fail to address deforestation along their supply chains might be the only way forward. The 2019 Indonesia and Amazon fires had a massive impact on people, planet and biodiversity – and showed clearly the high cost of business as usual. There needs to be change, and fast.
Image credit: Felipe Dias/Unsplash