Major companies are in danger of failing to meet their net-zero targets due to their links to deforestation.
Global Canopy, which campaigns against tropical deforestation, reviewed the policies and performance of 350 corporates in the forest commodity value chain and found that 98% are undermining their net-zero pledges.
Its review, 2023: A Watershed Year for Action on Deforestation, which also ranked how 150 major financial institutions are tackling the issue, found that 61% have no deforestation policies for any commodities. These firms together provided US$527bn of funding to other companies with no deforestation commitments at all in 2022, amounting to almost one tenth of their financing.
It also revealed that the ‘Big Three’ asset managers, BlackRock, Vanguard and State Street, have no policies in place, and that 31% of corporates have no deforestation commitments for any forest commodities.
Although most of the 350 major companies have at least one deforestation commitment, only 29% have pledges covering all commodities to which they are exposed. Global Canopy found that only half actively monitor their suppliers or sourcing regions to track whether commercial activity is aligned with their policies.
Executive director Niki Mardas called it “remarkable” that, while many top companies have ambitious net-zero targets, almost all risk missing them because of inaction on deforestation.
