Main Findings - Goal 2 Assessment Report
Deforestation-related commitments continue to rise
Since our 2015 NYDF Progress Assessment, 108 companies announced 212 new commitments, resulting in cumulatively more than 400 companies making more than 700 commitments.
The variety of deforestation-related commitments makes direct comparisons difficult
Commitments reach from signing on to high-level pledges such as those formulated in the NYDF, to individual targets on the production or sourcing of specific commodities. Very few companies commit to zero (gross) deforestation across their operations, most chose a step-wise approach that prioritizes and sets deadlines for individual commodities.
More than half of the sampled companies active in the palm oil and wood sector have deforestation-related commitments, with soy and cattle showing significantly lower numbers
These numbers give reason for concern considering the enormous climate and deforestation footprint of cattle ranching. These numbers correlate with the availability and use of certification as a tool to implement supply chain pledges. Overall more than 20% of global palm oil and 11% of timber is certified.
Action in deforestation hotspots is particularly relevant
Production and trade of the ‘big four’ commodities can be traced to a number of tropical priority hotspots – Indonesia, Brazil, Malaysia, and Paraguay in particular – where the majority of deforestation is concentrated. Targeted action in these countries is particularly important to reduce agro-commodity driven deforestation.
Despite low number of deforestation-related commitments in the cattle sector, recent years have seen a push towards sustainable beef production
In Brazil a number of innovative private-public initiatives (the Soy Moratorium and the G4 Agreement) have led to significant emission reductions driven by civil society and private sector action, and supported by proactive regional (state-level) institutions.
The large majority of commitments continue to come from companies headquartered in North America or Europe, although action in tropical forest countries is notably increasing
There is an increase in commitments and implementation among producer companies, in particular related to palm oil in South East Asia. Meat processing companies headquartered in Brazil have also made progress in eliminating deforestation from their operations. While engagement of companies higher up in the supply chain is significant, it is the actions from companies directly involved in production that show the greatest impact on deforestations.
There has also been significant progress in the implementation of supply-chain commitments, but time-bound actionable plans are still rare
Implementation involves the translation of announcement into practice by adopting specific, concrete policies and systems (e.g. production standards, procurement rules, operational plans, key performance metrics). Strategies on how a company can eliminate deforestation from its supply chains are difficult to compare depend on the targeted commodities, geographies, and the position of the company in the supply chain.
Most companies prefer to implement their policies by limiting procurement to certified commodities rather than defining their own production standards
The latter is particularly true for companies higher up in the supply chain such as retailers and manufacturers. Almost all companies engaged in the supply chain movement have assessed their exposure to deforestation embedded in their product lines.
Data on company compliance with commitments are lacking and very few companies have comprehensive monitoring systems in place
Tracing commodities to the producer level remains challenging for many companies, and very few companies can report on the impact of their pledges on deforestation. In particular soy and palm oil face barriers to traceability to the farm level. However, encouraging, new technological developments will help move tracing commodities further upstream to the level of production and with tying them local forest impact.
Companies need support from governments
Weak forest governance presents a major barrier to private-sector efforts. Although companies experience very limited global improvement in forest governance and public sector support, they report that REDD+ has led to a general awareness and willingness to act among governments. Lack of enforcement and corruption remain however major obstacles for private action and effective forest protection.
There are also a growing number of public-private initiatives supporting the elimination of deforestation at the supply chain or landscape level
Large-scale public programs backed by private sector announcement for preferential sourcing from such program areas provide a chance for ‘produce-and-protect’ partnerships. Sectoral agreements and moratoria as piloted in the Brazilian Amazon have also shown major impact on deforestation.
Despite the locally measurable positive effects of supply-chain efforts in some regions, it is still too early to tell whether the supply-chain movement had had an impact on deforestation rates
But, development of Trase and Global Forest Watch – Commodities Layer will provide data that can help address this question in next few years. Perhaps we can interest some journalist in these tools from a tech angle.
Pledges and commitments matter
Deforestation-related risk assessments, a dialogue with suppliers, and the revision of procurement rules are first promising steps in the right direction. Yet, a lot remains to be done, in particular to allow the tracing of commodities to the production level, and monitor the eventual impact of commitments on forests.
The assessment shows that NYDF endorsers and TFA 2020 member companies are more advanced
Across all supply chains- in terms of adopting commitments and translating them into actions. The public-private nature of these platforms enables also cooperation which prepares the grounds for the first ‘produce-and-protect’ partnerships.
Cross-sectoral cooperation enables risks, responsibilities, resources, competencies, and benefits to be shared
The NYDF can provide a platform for exchange of information and best practices leading to a cooperative implementation of strategies for sustainable land use that address deforestation at the national level.