From the Editors
The Ecosystem Marketplace's Forest Carbon News
Tracking Terrestrial Carbon
March ended with a bang here at Ecosystem Marketplace with the much-anticipated launch of a new initiative and website, Supply-Change.org. A year in the making, the project tracks pledges by 242 companies committing to eliminating or reducing deforestation in their supply chains. Commercial agriculture currently drives at least two-thirds of tropical deforestation, and palm oil, soybeans, beef and wood products are the major culprits.
Growing consumer awareness about the deforestation costs of many household products – and pressure from NGOs such as Greenpeace have led to a cascade of corporate commitments around palm oil and other agricultural commodities. At least one-third of new pledges on deforestation were made in 2014, according to the Supply-Change report.
Supply-Change.org makes sense of more than 300 commodity commitments by companies with a total market capitalization of at least $4 trillion. These commitments differ by scope, depth, timeframe, and sourcing criteria, and the newly launched website serves as a central platform for tracking companies' progress and aggregate impact. It also gives investors the ability to drill down to the company level to look at any commitments made, self-reported progress against the goal year (with direct links to the documentation), and a common key to show the elements of the commitment, such as human rights protection, "no burning," or zero deforestation versus zero net deforestation versus zero gross deforestation.
In a webinar launching the initiative, Gabriel Thoumi of Calvert Investments said such easily accessible criteria are essential. While Calvert uses over 2,000 environmental and social governance criteria to screen its investment funds, fewer than five of these are for palm, soy, cattle, and timber, the leading sources of deforestation globally, he said.
Supply-Change's analysis of hundreds of discrete commitments revealed a few trends. Most commitments (206) include land certification, with an aggregate impact on 185 million hectares worldwide. Nearly half of the commitments (122) aim for "traceability" – or the ability to trace products' ingredients back to the forest or field where they originated. Traceability has reverberations throughout the supply chain. On average, every one commitment from a major retailer such as Walmart spurs three upstream commitments from suppliers.
The project tracked the most commitments from the food industry, including manufacturers such as Kellogg's; retailers such as Carrefour and Tesco; and restaurants such as Dunkin' Donuts and McDonald's. Commitments are also being made by chemical companies such as BASF and Bayer, airlines such as British Airways, health care companies, and others.
Major retailer Marks and Spencer is one example of a quadruple commitment across all major deforestation-risked commodities. The company has committed to 100% certified palm oil (representing 2,683 metric tons), 100% deforestation-free soy, 100% recycled wood products, and 100% deforestation-free beef sourced outside of the Amazon biome.
Fiona Wheatley, Sustainable Development Manager at Marks and Spencer, said that Supply-Change.org is a welcome development since the company wants to be compared to its peers. "Deforestation is not a competitive issue," she said. Rather, companies need to work together to figure out how to eliminate deforestation from global supply chains.
And the deadlines for doing so are fast approaching: 71 company commitments cite 2015 as the target year for achievement, meaning that this year will be a critical indicator of the efficacy of voluntary corporate commitments. Another 52 companies set 2020 as the target year, in line with the New York Declaration on Forests to achieve zero deforestation by the end of this decade.
More stories from the forest carbon markets are summarized below, so keep reading!
—The Ecosystem Marketplace Team
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