15 June 2009
Minister of State Gareth Thomas today launched a new scheme under which companies can declare their ‘forest footprint’ – the impact of their activities on global forests. The Forest Footprint Disclosure (FFD) project is an initiative that aims to generate awareness of the concept of a ‘forest footprint’ and encourage businesses and investors to account for the sustainability of products within their supply chains.
A ‘forest footprint’ is the total amount of deforestation caused directly or indirectly by an individual, organisation or product. Forests are being lost at a rate of 13 million hectares a year because the environmental benefits they provide are not valued. Global demand for agricultural commodities is the primary driver of deforestation, as land is cleared to extract timber and produce beef, soy, palm oil and biofuels.
DFID provided a grant to help set up the FFD project. Speaking at the launch, Gareth Thomas said:
“The challenge we face today is to find new ways to reconcile the competing demands for wood, food, fuel, biodiversity conservation and reduced emissions from deforestation. Furthermore, we must prevent global demand for cheaper food and fuel from driving unsustainable agricultural expansion.”
Deforestation accounts for a fifth of all carbon dioxide emissions - more than the entire global transport sector. The Stern Review concluded that tackling deforestation represents the most cost-effective and immediate way to reduce global emissions. The FFD project is an important step towards generating more responsible consumption of products derived from forests and to improving due diligence for forestry by businesses and investors.
The new scheme is based on a similar model to that of the successful Carbon Disclosure Project (CDP) – the method by which companies declare their carbon footprint. By raising awareness of the investment risks associated with sourcing commodities from unsustainable forests, the FFD project aims to encourage investors to require companies to disclose their forest footprints.
2009 is a critical year for forests. The global deal due to be agreed at the climate change summit in Copenhagen this December is likely to include a mechanism to reduce emissions from deforestation and degradation (REDD). If agreed this will generate billions of dollars to help reduce deforestation, and is likely to increase costs to businesses and in supply chains with a forest footprint.
Taking action to reduce deforestation is not about creating trade barriers that will disadvantage developing countries, but building more sustainable supply chains that will aid these countries in the long term.
Protecting forests is important for the sustainability of all agribusiness in rainforest regions. The large scale destruction of rainforests can have significant impacts on regional ecosystems, affecting all people and businesses that depend on forests and rainfall cycles for their livelihoods. For example, scientific projections for the Amazon rainforest show that if deforestation continues at its current rate, there is a significant risk that this would not only affect everyone who depends on the forest but also drive electricity costs higher (70% of Brazil’s power comes from hydro-electricity) and increase commodity prices and food shortages. Ironically, much of the agribusiness that is driving deforestation in the Amazon is dependent on the rainfall provided by the same forests that are being destroyed to provide new land for crops.
The FFD project aims to publish its first annual report on forestry impacts by FTSE100 companies in early 2010. The report will identify companies that are best in class, those that have adopted innovative policy and practice to drive performance improvement, and those that declined the request to disclose their forest footprint.
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Photo: David Gilbert
