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Sustainable commodity commitments rocket but most firms struggle with traceability

By David Burrows , 10-Nov-2016
Last updated on 10-Nov-2016 at 15:00 GMT2016-11-10T15:00:27Z

Forest in Brazil cleared for soy crops. ©iStock/Phototreat
Forest in Brazil cleared for soy crops. ©iStock/Phototreat

New commitments to tackle deforestation in commodity supply chains have almost doubled in the past 12 months, but pledges remain “piecemeal” with very few companies looking beyond palm oil, according to a recent analysis.

Compiled by not-for-profit organisation Forest Declaration, the global analysis of 600 firms producing or sourcing significant quantities of ‘the big four’ commodities linked to deforestation – palm oil, soy, beef and timber – also showed that 415 of them have made 701 pledges to reduce their impacts on forests.

In the past 12 months the roll out of commitments has ballooned: 108 companies have announced 212 new commitments, representing a 43% increase compared to the previous year.

Manufacturers and retailers have led the way – 70% and 30% respectively of those assessed have made deforestation-related commitments. Most companies have also established rules about how goods are produced and sourced that are in keeping with their sustainable sourcing targets.

The majority of the pledges (89%) are also made by companies head-quartered in the EU, the US and Australia, with a similar number (91%) from firms sourcing or producing from deforestation ‘hotpots’, like Brazil and Indonesia.

Quantity over quality

The rapid expansion of corporate commitments is one thing; turning them into action is proving a far greater challenge, according to the researchers that compiled the report.

Progress is “too gradual”, they noted, with nearly all commitments only addressing one commodity or a specific geography. Indeed, only 43 of the 415 firms with commitments in place have set company-wide targets covering all commodities relevant to their portfolios.

Most also seem to be focusing on palm oil – 59% of the 629 firms assessed have made a palm oil pledge, compared to 21% that have done so for soy.

Commitments relating to cattle and beef lag even further behind, at 12%. This is particularly concerning, the authors noted, considering that cattle have a deforestation footprint nine-times larger than the one associated with palm oil.

“The numbers correlate with the availability and use of certification as a tool to implement supply-chain pledges,” they said. “Overall, more than 20% of global palm oil […] is certified.”

Similar schemes for beef are not so easy to establish, said Charlotte Strech, director at Climate Focus, one of the 12 think-tanks involved in compiling the report . “Raising cattle is one of the leading causes of deforestation, but it’s difficult for the sector to make commitments as cows change hands multiple times over their lifespans,” she explained. “Tracing deforestation to the specific animal is a major challenge.”

Tough to track

Regardless of the commodity, traceability is a headache. Though 70% of the companies assessed have monitoring systems in place, robust ones remain “rare”, the authors noted.

Just over a third (39%) of firms tracing palm can do so to the processing facility, but beyond that they struggle – 7% can trace back to the plantation and 2% to the forest. For soy it’s proving even trickier: only 52% can follow their soy supply back to a country level, with 7% able to track back to the mill.

Soy is often referred to as a ‘hidden ingredient’ in foods, given that three quarters of it ends up in animal feed. Some companies have signed up to initiatives like the soy moratorium, which prohibits deforestation in the Amazon, but progress is lagging behind palm oil and it hasn’t gone unnoticed.

Historically consumer campaigns have targeted palm oil, but increasingly advocacy NGOs are targeting the soy, as well as the cattle, sector,” said Sarah Lake from the Global Canopy Programme.

Certification limits

WWF’s analysis earlier this year of 133 leading manufacturers, processors, retailers and feed companies, showed that just 16 have strong commitments to sourcing responsible soy. The NGO has since called for a deforestation action plan in Europe. Others have urged the EU to extend its deforestation laws beyond timber to encompass other commodities like beef, soy and palm oil.

Lake admitted that certification is not a panacea. “… while effective in some markets, [certification] does not have equal uptake for all commodities, nor is it feasible for all commodities. It must operate together with government regulation,” she told Foodnavigator.

Norway recently committed to exclude products linked to deforestation from their market, whilst the Indonesian government has taken action to protect and restore peatlands. Meanwhile, Unilever and Marks & Spencer have committed to preferential sourcing from countries that have ambitious climate and forestry initiatives in place .

“The private sector can’t deforest alone,” said Strech at Climate Focus. “Governments must get a firm grip on what’s happening in their forests […] so that businesses can operate on the ground without risk.”  

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