Rainforest in Panama
Did you have an egg or bacon for breakfast? Did you use shampoo or showergel containing palm oil this morning? If you did, the chances are a little bit of the rainforest was destroyed for your morning.
“We are eating the rainforest every day without knowing it,” says Andrew Mitchell, head of the Forest Footprint Disclosure project steering committee and executive director of the Global Canopy Programme. If you are a fund manager, your investments are also probably responsible for large swathes of tropical rainforest being bulldozed.
Asset managers are by now fairly familiar with the Carbon Disclosure Project, an attempt to get companies to disclose their carbon emissions so investors can assess the associated risk.
Now the CDP is supporting a similar initiative, launched today, to get companies to disclose their Forest Footprint. This is the impact their activities, especially in their supply chain, are having on the rainforests globally. This matters because rainforests are a key part of global climate systems, not to mention the 20 per cent of current global carbon emissions that are due to rainforest destruction.
The Forest Footprint Disclosure project has identified five ‘forest risk’ commodities, demand for which is pushing deforestation. These are timber, beef, soya, palm oil and biofuels. Since timber is largely used for paper and soya is a key component of animal feed, it is hard to think of an industry sector that does not have some forest footprint to disclose, or a product in our daily lives that is not implicated.
Supported by (among others) the UK’s Department for International Development, the FFD has assembled a group of asset managers representing £1,300bn in assets under management. On their behalf, it will write to companies asking them to fill out a questionnaire about their forest footprint.
