SUPPLY CHANGE

June 17, 2016

Dear Colleagues,

Don’t want a side of deforestation with your meal? The companies behind the commitments tracked in Forest Trends’ newest report, Supply Change: Tracking Corporate Commitments to Deforestation-free Supply Chains, 2016, are working towards giving you that option. The report, which was launched at the Global Landscapes Forum in London on June 6, looks at 566 companies representing at least US$7.3 trillion in market capitalization identified as having deforestation risk tied to the “big four” agricultural products associated with about a third of the world’s deforestation - cattle, soy, timber & pulp, and palm. Of these companies, 366 have made 579 coinciding commitments to shift to sustainable commodity sources – up from 307 commitments from 243 companies tracked in our first report.

Companies are most likely to make commitments toward palm – the ingredient that’s ubiquitous in snack foods and beauty products – and timber & pulp. Of companies active in palm, 61% have adopted pledges to reduce or eliminate deforestation in their supply chains, compared with only 15% of those companies active in cattle. The disparity is alarming because it is estimated that cattle production causes 10 times more deforestation than palm – and deforestation globally is behind up to 15% of greenhouse gas emissions

“Negotiators from nearly 200 governments adopted the Paris Climate Agreement in December, and they did so with massive support from the private sector backed by hundreds of pledges to end practices that destroy forests for the sake of palm, soy, cattle, and timber & pulp,” said Michael Jenkins, President of Ecosystem Marketplace’s publisher Forest Trends. “Now comes the hard part: keeping those pledges.”

Commodities are intended to be uniform products, but no two commitments that companies make are the same. Commitments range from purchase of certificates or credits that support sustainable production – such as Kirin Holdings – to those that aim for zero deforestation throughout the commodity supply chain – such as Procter & Gamble.

“Ambitious corporate action is a critical prerequisite to achieving deforestation-free commodity agriculture,” added Jenkins. “But ambition alone is no substitute for accuracy and transparency, and commitments count the most when companies publicly disclose progress toward achieving them.”

In fact, public information on companies’ progress towards sustainable supply chains is only available for one in three commitments. When companies do disclose progress, the news is encouraging. On average, achievement toward commitment goals is 74% for those with publicly available information.

Supply Change: Tracking Corporate Commitments to Deforestation-free Supply Chains, 2016

The production of this report would not have been possible without our donors the Global Environment Facility and the United Nations Environmental Programme, and the project collaborators CDP and WWF.

To learn more, download the full report and register for Supply Change’s July 12th webinar co-hosted by Forest Trends and Innovation Forum where leading experts on commodity deforestation will discuss the report findings and examine trends among corporate commitments. Also, be sure to visit Supply-Change.org to view the ever increasing number of company profiles cataloged there.

More stories about changing supply chains are summarized below, so keep reading!

-The Supply Change team

 

 

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Webinar announcement 

Join leading experts on commodity deforestation for a July 12th panel discussion co-hosted by Forest Trends and Innovation Forum featuring the new Supply Change report. This informative webinar will examine trends among corporate commitments to reducing deforestation from the “big four” agricultural commodities – palm, timber & pulp, soy, and cattle. Register here.

 

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Recent News

Norway says “no way” to deforestation

Norway has become the first country to “impose requirements to ensure that public procurements do not contribute to deforestation of the rainforest,” according to a recent press release by the Rainforest Foundation Norway. The Norwegian Government’s Standing Committee on Energy and Environment made this pledge as part of its recommendations to parliament on the government’s Action Plan on Nature Diversity. According to Nils Hermann Ranum, the head of Policy and Campaign at Rainforest Foundation Norway, this marks an important milestone for protecting the world’s rainforests, but he says, “other countries should follow Norway’s leadership, and adopt similar zero deforestation commitments. In particular, Germany and the UK must act, following their joint statement at the UN Climate Summit.”
Read more on the Rainforest Foundation Norway.

 

Dropping the lawsuit, what’s NEXT?

Last week, one of the world’s largest palm oil producers, IOI Group, announced it will withdraw its lawsuit against the multi-stakeholder initiative, the Roundtable on Sustainable Palm Oil (RSPO). After being suspended for breaking RSPO rules, purchasers like Unilever and Kellogg dropped IOI as a supplier. In response, IOI challenged the RSPO in Swiss court, arguing it had been “unfairly affected.” Many discouraged this action. Mondelez International publically pressured IOI  to “quickly withdraw its legal challenge against the RSPO” and “implement group-wide reforms.” Instead of taking legal action, IOI has now said it will meet the RSPO’s more stringent RSPO NEXT requirements by the end of this year. Campaigners are watching closely to ensure IOI’s implementation meets its environmental commitments.
Read more on TriplePundit.

 

A face-palm for EU biofuels

Biofuels made from palm oil actually have a larger carbon footprint than traditional fossil fuels,according to new data on biofuel use in the European Union (EU) from the environmental group Transport & Environment. It’s not that the emissions are higher, but rather that the sourcing of palm oil as a primary ingredient leads to tropical deforestation – removing vital carbon sinks. The findings further claim that the entire 34% growth of the EU biofuels sector has been due to increased palm oil use, which undermines the EU’s otherwise successful efforts to reduce palm oil in food, industrial uses, and animal feed. Palm oil used for transportation in the EU is equivalent to four Olympic-size swimming pools every day.
Read more from Transport & Environment

 

Too much soy in the sauce

Martin & Servera, Jumbo Supermarkten, and Arla Foods were among the top companies based in the nine European countries included in latest Soy Scorecard. The World Wildlife Fund for Nature (WWF) analyzed soy use by 133 European companies and found that “while some front-running companies are leading the way on responsible soy, far too many are lagging behind – or hiding from responsibility.” Companies were scored based on their environmental commitments, membership in the Round Table on Responsible Soy and ProTerra certification schemes, responsible purchasing levels, and support for small- or medium-sized producers.
Read more at the Food Navigator.

 

Meat the new soy guidelines

The Consumer Goods Forum (CGF) has released its latest sustainable soy sourcing guidelines. These guidelines are meant as a tool for companies to assess their own soy footprint. The guidelines are innovative in that they go beyond the direct uses of soy (soy milk, tofu, soy sauce, etc.) and delve into the indirect uses (meat and dairy fed on soy). The guidelines advance efforts to decouple deforestation from soy supply chains and help the 441 CGF members meet their goal of zero net deforestation by 2020.
Read more about the CGF Sustainable Soy Sourcing Guidelines.

 

More committed than thou

A recently released study of the 55 CGF companies named in the Forest 500 platform found that only 14 had formulated their own deforestation-free, cross-commodity supply chain commitments. However, only three percent of non-CGF members in the Forest 500 made similar commitments. Forest 500 identifies and assesses the deforestation policies of the world’s 250 most influential companies in the transition to a deforestation-free economy. Report authors, CDP and Global Canopy Program, argue that the 2010 CGF board resolution for members to collectively achieve zero net deforestation supply chains by 2020 did influence action.
Read the report.

 

Not milling around

Tracing where the palm oil in your doughnut – and most other consumer goods – came from just got easier. Global Forest Watch, an initiative of the World Resources Institute, recently released the new PALM (Prioritizing Areas, Landscapes and Mills) Risk Tool to help companies anticipate deforestation risk associated with palm oil mills and inform responsible sourcing. With locations for 800 palm oil mills and counting, this tool draws from the largest public database of mill locations available. The PALM Risk Tool develops a risk ranking for mills by mapping fire activity and tree cover loss within a 50 kilometer radius. Companies can upload additional mill locations and use the ranking to prioritize which mills require the most additional research, auditing, and engagement.
Read more at the World Resources Institute.

Supply-Change.Org
 

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