CDP expands deforestation supply chain work

23rd May 2017


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Martyn Grant

Eight companies have started to gather information from suppliers on what they are doing to end deforestation related to their products as part of the CDP's expanded supply chain platform.

The firms, including McDonalds and its Latin American franchise Arcos Dorados, L’Oréal and Johnson & Johnson, are focusing on the commodities responsible for most tropical forest loss, cattle, timber, palm oil and soy.

The companies have requested information on the strategies used by suppliers to measure and monitor use of these commodities, progress against deforestation targets and engagement with their supply chains.

The CDP is already running a programme on deforestation, but so far this has involved requesting information from major corporations on behalf of investors. The new initiative is the first time purchasers have requested information from companies in their supply chain through the CDP and would improve transparency among small- and medium-sized businesses that had not previously disclosed data.

The number of companies that have pledged to end deforestation from supply chains has increased in recent years. The Consumer Goods Forum (CGF), which represents 400 firms with a combined revenue of $3.9tn, has pledged to achieve zero net deforestation in supply chains by 2020.

However, assessments of progress have revealed patchy performance. Just 36% of the 256 members of the CGF analysed by the WWF had made individual commitments to combat deforestation.

A study by campaign groups into progress by the 52 corporate signatories to the New York Declaration on Forests to halve deforestation by 2020, found that, although most companies had established rules about how goods were sourced, nearly all the commitments addressed only one commodity, or a specific geography.

Dexter Galvin, head of supply chain at CDP, said that ending deforestation was fundamental to global efforts to prevent dangerous climate change. ‘With such a large proportion of company revenues attached to commodities in their supply chain that are driving deforestation, this is now a critical business issue.

‘Supply chains are like rows of dominoes: if unsustainable commodities enter the top of a supply chain, the effects will cascade throughout. Collaboration with suppliers is therefore essential for companies to reduce their exposure to deforestation and meet their zero deforestation targets – which makes sense for the bottom line and the planet.’

Four companies, Arcos Dorados, Firmenich, Johnson & Johnson and L’Oréal, are now gathering information from suppliers across all three areas covered by the CDP’s supply chain project – climate change, water and forests.

The CDP is piloting the expanded programme this year and will publish the data collected in its annual supply chain report in 2018.

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