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Companies risk almost US$80 bln without action to tackle deforestation in supply chains

25/05/2022 06:27 PM

KUALA LUMPUR, May 25 (Bernama) -- Companies cannot afford any more delay in tackling deforestation across supply chains, with forest-related risks identified at almost US$80 billion by 211 disclosing companies, said CDP, a global non-profit organisation that helps companies and cities disclose their environmental impact.

CDP forest global director Thomas Maddox said billions of people are relying on forests for their livelihood and they play a crucial role in climate mitigation and adaptation.

“However, deforestation continues almost unchecked. Last year, a further 11 million hectares of tropical forest were lost due to large scale production of agricultural commodities.

“Companies are starting to respond but we need more investors to demand the eradication of deforestation from their portfolios. We need more companies to commit and deliver deforestation-free supply chains,” he said in a statement today.

Citing a 2021 report by the World Resources Institute, the CDP said Malaysia experienced a decline in primary forest loss for four years in a row. 

“Thus far, the Malaysian government is optimistic that it would be able to achieve its Nationally Determined Contributions (NDC) of reducing carbon intensity by 45 per cent by 2030.

“However, more actions are needed to ensure that the country is able to achieve its goals,” it said.

Even though companies from Southeast Asia (SEA) have been taking more meaningful actions compared to their global peers, many are still demonstrating notable implantation gaps, said the CDP.

“Only two per cent of companies have robust no-deforestation/no conversion commitments, and only 23 per cent can trace more than 90 per cent of one commodity to a municipality or its equivalent level.

“Additionally, only 25 per cent of companies disclosed that they are providing smallholders with technical or financial assistance and only 33 per cent are providing similar assistance to direct suppliers,” it said.

Meanwhile, CDP Southeast Asia and Oceania director John Leung said that companies still need to go a lot further and faster to ensure pledges made across SEA at COP26 will be met.

“We know that biodiversity and protecting forests are vital to ensure we reach a net-zero and nature positive future,” he said.




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