Mighty Earth                            DEF0037

Written evidence submitted by Mighty Earth

The effectiveness of UK efforts to reduce global deforestation

Summary

Mighty Earth is a global advocacy organization working to defend our living planet. Mighty Earth is responding with evidence surrounding specific commodities, based on the evidence and data we hold internally and our specific areas of expertise regarding forest commodities in the UK market. We do however support the delivery of robust Due Diligence legislation which dramatically reduces the UK’s environmental footprint, and lays responsibility with the relevant actors in the complete supply chain across all forest commodities – this includes timber.

-          UK Due Diligence requirements must include all forms of deforestation, not only illegal, and our response to this Inquiry provides detailed evidence and justification to illustrate why it is paramount for effective legislation to include this in order to deliver on the Inquiry’s key outcome – reducing global deforestation.

-          All UK supply chain actors must be covered by the legislation, this includes importers, retailers and financiers of both projects and corporations involved in or connected to forest commodities.

-          Traceability is imperative and third-party verification and monitoring is a requirement of a legitimate due diligence system, the characteristics of which should be detailed in the Environment Act 2021 and enforceable by The Office for Environmental Protection.

-          We recommend a Group Level Responsibility model is applied throughout the Due Diligence legislation to ensure the relevant accountability and burden is shouldered by those actors most able to absorb and to ensure responsibility sits with those actors who have profiteered most substantially from a lack of adequate regulation in this area to date. We would highly recommend engagement with small holders, to ensure their specific needs are considered and catered for, to ensure the burden of risk does not fall to them disproportionately.

Existing examples of good practice include the Amazon Soy Moratorium and progress in Palm Oil traceability and monitoring systems – both initiatives have positively transformed their respectively industries with dramatic, and positive effect. Since the adoption of No Deforestation, No Peat No Exploitation pledges by the palm oil industry, deforestation in Indonesia, Malaysia, and Papua New Guinea attributed to the development of oil palm plantations has fallen to its lowest level since 2017.[1] The Amazon Soy Moratorium (ASM) led to the decrease of deforestation in the years preceding the agreement. A 2014 study by Nature found that in the 2 years preceding the agreement, nearly 30 percent of soy expansion in the Amazon biome occurred through deforestation. But after the ASM direct deforestation for soy fell to only 1 percent of soy expansion in the Amazon biome.[2]

Areas such as the Cerrado savannah, the Pantanal and Gran Chaco areas of South America, not included in the ASM have however seen rapid expansion as those areas go largely legally unprotected from deforestation. Initiatives such as the Cerrado Manifesto aim to shine a spotlight on biomes of significance and demonstrate a lack of support for agricultural expansion in the region, however these initiatives are largely being ignored by the region’s soy producers. The Consumer Goods Forum approved their Deforestation pledge in December 2010 – their pledge was the help business achieve zero net deforestation by 2020. The deadline has been and gone, largely ignored, with companies pledging new targets a further decade into the future and beyond.[3]

Our hope is the UK Government will adopt learnings from existing legislative initiatives which have proved to be successful in the reduction of deforestation and human rights abuses, recognising both faced opposition from agribusiness initially.

In what ways and to what extent are UK value chains (in the form of public procurement, goods, services, or the private sector) contributing to global deforestation?

The UK contributes to global deforestation across a number of different industries through direct and indirect sourcing of the following commodities: soy, cocoa, coffee, palm oil, beef and leather, paper, natural rubber, and timber. Unsurprisingly with London ranked as second in the Global Financial Centres Index (GFCI)[4], the UK’s financing of projects, initiatives and businesses continue to support corporations who make a significant contribution to financing the UK’s – currently known - deforestation footprint.

The following examples do not by any means give an exhaustive list of examples; rather a small sampling to indicate the scale of the UK’s current footprint on global forests.

-         Beef, meat and soy impacts

Meat is the world’s largest driver of deforestation, wildlife extinction and displacement of Indigenous peoples. In October 2021, leading European supermarkets acknowledged both
the meat industry’s impact and the rising concerns of their customers about the environmental damage caused by meat.[5] Meat, dairy, and aquaculture cause more climate pollution than all the world’s cars, trucks, and ships combined.[6] Production of livestock feed, combined with the use of cows, pigs and other animals for food, is responsible for 57 percent of all food production emissions, about 9.8 gigatons of carbon dioxide equivalent per year. [7] In comparison, emissions from the global transport sector were about 7.2 gigatons in 2020.[8] Cattle ranches and soy animal feed plantations are the greatest driver of this deforestation, with more than three quarters of the world’s soy used to feed livestock.[9] Due to campaigning and pressure from civil society, the import of beef to the UK has dramatically reduced in recent years – although still poses a risk. Imported soy is the single largest contributor to Europe’s global deforestation footprint. [10] Tesco estimates 99% of its 2021 soy footprint is for animal feed, with only 1% for soy products (such as tofu, milk, etc..). The UK imports an estimated 3.2 million tonnes of soy every year. Some 68% of this soy comes from South America. A study in 2019 estimated only 27% of soya consumed in the UK was covered by a deforestation and conversion free soya standard. [11]

The UK Government cannot meet its Net Zero targets or meet a deforestation and conversion-free future without solving the issue of unsustainable soy and its’ associated deforestation impact overseas.

-         Natural rubber

Natural Rubber plantation expansion has had an enormous impact on tropical forests over the past 20 years, particularly in Southeast Asia and West Africa. Between 2003 and 2017, an estimated 5 million hectares of tropical forest were cleared across Southeast Asia and sub-Saharan Africa for rubber plantations.[12]

Natural rubber (Hevea brasiliensis) is essential for the manufacture of vehicle and airplane tyres (comprising 70% of global natural rubber consumption), medical equipment, prophylactics and sportswear. The UK is an important actor in global rubber markets, particularly with regards to processed rubber, predominantly embedded within vehicle tyres. In the decade between 2012 and 2022, the value of rubber and rubber-related imports into the UK increased by nearly 40%, reaching around £520m in February 2022 (see graph below).

Some tyre companies have made zero deforestation commitments, and a voluntary multistakeholder sustainability initiative, the Global Platform for Sustainable Natural Rubber (GPSNR), of which Mighty Earth is a member, works to address deforestation alongside other sustainability concerns. However, large segments of the rubber and tyre industries fall outside of this initiative, and have thus far failed to make (let alone implement) voluntarily commitments to avoid deforestation.

According to the International Rubber Study Group, the demand for natural rubber is forecast to increase by 4.5 million tonnes over the period 2021-2030 – with prices set to boom 33% over this period. Unpublished academic analysis by Dr Eleanor Warren-Thomas et. al. (forthcoming) forecasts that increased demand will require a further area of rubber cultivation of between 2.7m – 5.1m hectares by 2030. As rubber can only grow in tropical regions, and other tropical agricultural systems are also expanding their footprint, rubber plantation expansion is expected to increase pressure on tropical forests and contribute to further deforestation. (NB. This paper is currently going through peer review in a high-quality academic journal).

-         Cocoa

The expansion of cocoa farming has had a massive impact on forests in West Africa and beyond. According to the World Bank, between 1988 and 2007, West Africa lost 2.3 million hectares of forest to cocoa cultivation, which has caused serious soil degradation, water insecurity and crop failures.

Deforestation is a major issue in Côte d’Ivoire and Ghana, which together produce nearly two-thirds of the world’s supply of cocoa. According to the World Cocoa Foundation, Côte d’Ivoire and Ghana respectively lost 25% and 8% of their primary forest between 2002-2019, with a “significant portion” of deforestation due to cocoa farming[13].

Although the industry pledged to take action through the World Cocoa Foundation’s Cocoa and Forests Initiative, the rate of deforestation in the world’s two largest producers has barely slowed since this initiative was launched in 2017. Research published by Mighty Earth in February of 2022 revealed that, more than four years after the high-profile launch of the Cocoa and Forests Initiative, Africa’s top cocoa-producing nations continue to see huge areas of forest being destroyed to make room for cocoa production.[14] Even after the industry published action plans in 2019, Côte d’Ivoire lost 19,421 hectares – 74.9 sq. mi. – of forest within cocoa growing regions and Ghana lost 39,497 hectares – 152.5 sq. mi. This amounts to a combined area equivalent to the size of the city of Madrid, Seoul, or Chicago.

According to the Divine chocolate company, the UK has the seventh highest consumption of chocolate in the world, and the 4th biggest in Europe. [15] The average Brit consumed 8.4kg of chocolate in 2017. In Britain we eat an estimated 660,900 tonnes of chocolate a year, an average of 11kg per person per year, while the UK chocolate industry was worth £3.96 billion in 2021, with the company predicting increased sales over the coming years. In 2020, the country imported 116,000 tonnes of cocoa beans.[16]

It is therefore essential that Britain seeks to play its part to address the problem of West African deforestation embodied within UK cocoa and chocolate consumption.

-         Finance Sector impacts

A lack of alignment of zero deforestation policies across the finance sector and the absence of regulatory ambition perpetuates an industry-wide approach to continued investment in portfolios which have a high risk of deforestation through commodity supply and trading. The lack of adequate monitoring across the agribusiness sector, as well as underreporting of the risks of deforestation in companies’ portfolios, dictates a lack of ambition by the finance sector to extrapolate those companies and investment projects from existing portfolios. Many UK banks currently lack adequate environmental and Human Right protection policies, leaving the banks and their investors complicit in deforestation, sometimes unknowingly and other times not.

How effectively is the Government monitoring the UK’s contribution to global deforestation and its progress in tackling the issue?

-         Evading responsibility

Retailers, business and investors have received significant evidence of deforestation linked to their supply chains dating back many years, all of whom have failed to take discernible action to remove known contamination of deforestation from their supply chains. Despite a flurry of green policies and statements, we have yet to see any meaningful action from many industries to meet deforestation and conversion-free commitments and it is clear from an open letter signed on 6 December 2021[17] that retailers require robust Government action to sanction them, and their overseas suppliers into action.

-         Traceability and verified monitoring

UK supply chains lack the necessary transparency for downstream actors to adequately monitor high-risk commodity chains into their own supply – leaving those supply chains at significant risk of deforestation. The lack of legal accountability for end users provides little incentive for investment in traceability mechanisms. Subsequently, UK supply chains are left open to significant risk of deforestation, as outlined in Mighty Earth’s recent report Promises, Promises! This report found 27,000 hectares of deforestation from just 10 soy farms based in the Brazilian Cerrado region in a 6-month period in 2020. [18]Commodity traders, including Cargill, who supply over 70% of the UK’s soy supply are shown to be actively sourcing soy from farms know to have committed deforestation, land right violations and labour right disputes. [19]

A lack of robust, legislated monitoring allows traders, importers, and downstream retailers to avoid any ramifications should their supply be contaminated, or a supplier associated with deforestation. Tesco’s 2021 Group soymeal footprint was 514,003 tonnes and of that, only 46% could be tracked to a region and of the percentage coming from Brazil, only 21% claimed to be attributed to deforestation-free supply, though as the group used Mass Balance – a blend of certified and uncertified supply – the proportion of their total supply is likely to be significantly lower than 21% attributable.

The UK Space Agency helped to develop the satellite monitoring system - the IMAGES platform - that was eventually adopted by the government of Cote d’Ivoire which layers land use data and deforestation alerts. While it lacks supply chain information, this could be a good model for a “UK deforestation observatory.”  To see an example of what this would look like with supply chain data added in, please see Mighty Earth’s Cocoa Accountability Map, which includes the location of over 2,000 cocoa coops, plus their supply chain information.[20]

-         Transparent, public reporting

There is currently no centralised system for monitoring the UK’s total impact on deforestation. The range of differing monitoring and traceability systems across various sectors and commodities has created a complex web of opaque systems. Without an effective monitoring system across all UK imported commodities, with even low risk of contamination of deforestation, the UK Government will be unable to assess its footprint, outline targets for improvement and monitor against those targets. Without centralised monitoring the UK Government will be unable to deliver an adequately assessment of the total impact of deforestation both on overseas partners, as well as in relation to the UK Governments own Net Zero Plans.

-          Palm Oil best practice

Existing voluntary systems such as those found in the palm oil sector, enable downstream buyers to adequately calculate risks, and grievance systems allow notification of contamination to downstream actors who can then pressure their suppliers to clean up their supply chains. It is recommended the UK Government, through Due Diligence legislation, requires an adequate monitoring system that touches each level of the supply chain. At a minimum, in products made with oil palm, this means traceability from the palm oil mill, trader and to the consumer facing company.

The palm oil industry in Indonesia, dramatically reduced deforestation by 93% as a result of the traders' adoption of strict zero-deforestation policies that applied to their suppliers at a group level and included legal and illegal deforestation.[21]. Several UK consumer companies have been instrumental in pushing for the implementation of these no deforestation policies including PZ Cussons and Reckitt Benckiser along with multinational brands that have big footprints in the UK like Mondelēz/Cadbury.

These policies significantly improved traceability mechanism, the UK Government should move to provide leadership through legislation for an accredited verification system. To ensure supply chains can be verified Deforestation and Conversion-Free (vDCF) – industry/UK retailers will have to move to a ‘clean supply approach’ and accountability at a Producer Corporate Group Level.

In Mighty Earth’s experience monitoring the palm oil industry compliance with their No Deforestation, No Peat, No Exploitation (NDPE) policies, is a fundamental element in reducing deforestation across the supply chain for any given company. This includes regularly (at least twice a year) publishing of supply chain information such as supplying mills, regularly updating grievance logs, and responding to investigative inquiries in a timely manner as well as applying a suspension to producer groups who violate the policies.

Mighty Earth’s palm oil Rapid Response Reports demonstrate that the information necessary for the industry to be monitored is readily available. This includes satellite deforestation alerts, high quality satellite imagery to examine cases, concession boundaries, supply chain data, and other layers like the indicative High Carbon Stock (HCS) map which helps to determine whether the area that was cleared was covered by the policy. Examples of supply chain information can be found in page 4 in Mighty Earth’s Rapid Response Report alongside satellite imagery used for mapping paired with HCS map. This methodology allows adequate tracking for Group Level model accountability, using existing technology and tested methodology. [22]

And what progress has been made by Government to develop an indicator on overseas environmental impacts of UK consumption of key commodities?

Mighty Earth is not aware of single indicator where the UK’s environmental footprint from deforestation has been assessed. The lack of legislated and uniformed monitoring leaves the Government blind in assessing Scope 3 emissions from overseas forest commodity trading, bearing significance on the ability to meet Net Zero targets.

There has been moderate progress in monitoring across some commodities (namely palm oil), but these systems do not express the full environmental and social of the UK’s consumption impacts. Two thirds of consumers want

The Food Standard Agency found 73% of UK consumers felt it was important their food had a low carbon footprint and almost half (49%) called for carbon footprint labelling. [23]

A study by Oxford's Livestock, Environment and People (LEAP) programme outlined the methodology to develop environment food labelling.[24]

How effective are the measures to improve due diligence and ban imported products of illegal deforestation in the Environment Act 2021?

We welcome the UK Governments ambition to ensure robust due diligence mechanisms as part of the Environment Bill 2021 and our hope it that the secondary legislation will deliver the necessary teeth to enforce this stated ambition.

-         Deforestation definition

It is imperative the UK Government applies a methodology to determine deforestation which will ensure a practical, transparent, robust, and scientifically credible approach that is widely accepted to implement commitments to halt deforestation, while ensuring the rights and livelihoods of local peoples are respected. For example, the High Carbon Stock (HCS) Approach [25] is a such a robust methodology that distinguishes tropical forest areas for protection from degraded lands with low carbon and biodiversity values that may be developed.

-         Due Diligence on ALL types of deforestation

Due diligence responsibilities to ban only products deviated from proven illegal deforestation will be ineffective in reducing deforestation – and its wider negative impacts – caused by UK commodity consumption. As stated in the Government’s overview of this Inquiry ‘countries with high or very high risk of deforestation, weak governance arrangements and poor labour standards.’

As an example, in Cote d’Ivoire and Ghana, much of the cocoa grown illegally in protected forest areas and national parks is blended[26] with harvests from legal cocoa farms at first point of purchase, from where it is sold on to traders. This even happens with so called “mass balance” cocoa, where cocoa that is certified[27] as “sustainable” is mixed in with uncertified, untraceable cocoa. To complicate matters further, some of the cocoa grown in certain protected areas is licenced, while are sources are not. In addition, sometimes the boundaries and official government definitions of “forest” changes or is never made clear (let alone enforced). It is therefore not meaningful to delineate between legal and illegal cocoa. Instead, it is better to mandate companies to develop systems to exercise meaningful due diligence to ensure all the cocoa importing by the UK is deforestation-free.

Similarly, with natural rubber, the rapid expansion in plantations which took place between 2002-2017 in the Greater Mekong region was largely driven by well-documented illegal land grabs[28] by Vietnamese and Chinese companies in neighbouring countries, often facilitated by local military or government officials, [29] and at times subsequently legitimised by corrupt judiciaries in those countries. The legacy of this is that rubber now being tapped from trees in countries like Cambodia, Laos and Myanmar is now being integrated into the overall supply chains of Vietnamese and Chinese conglomerates that supply international supply chain actors. It is therefore not meaningful to delineate between deforestation in those rubber supply chains that was or wasn’t done legally. Again, the only effective course of action is for companies to ensure that all their rubber is free from deforestation, rather than try to figure out what rubber-related deforestation is and isn’t “legal.”

A further example comes from Brazil. There, commodity governance and forest law enforcement services have slowly been dismantled under President Jair Bolsonaro’s reign, leaving local communities and Indigenous peoples in grave danger, as they struggle to protect forests from those who feel emboldened to encroach their land. The latest figures from the Brazilian Space Research Institute (INPE) recorded on 22 August 2022, shows a new record of fires, with 3,358 fires. Data from the INPE Deter system indicates that deforestation in Brazil was the highest in August since 2017. [30] The rhetoric from the Government and the impunity the Bolsonaro regime offers has seen cases of illegal deforestation re-classified as legal. A recent investigation delivered by Instituto Mãos da Terra (IMATERRA), outlines cases where creative interpretation of local law has resulted in the declassifying of illegal deforestation to legal through a defunct, non-verified administrative processes. [31] This study shows over 3,320 hectares of deforestation occurred around Formosa do Rio Preto - the analysis identified that there was no justification for the request for deforestation; even so, the Instituto do Meio Ambiente e Recursos Hidricos (INEMA) authorized the clearing of vegetation.

These cases highlight where local authorities have failed to consider the total impact of the deforestation – including environmental, economic and social considerations and highlights a disparity between international, state and municipal law enforcement and decision-making processes regarding land clearance permits. This report centres on only one country importing to the UK. For the UK Government to adequately meet its ambition of reversing deforestation by 2030, and recognising the insurmountable resources required to assess all state and municipal laws in exporting countries, the adoption of legal deforestation definition will be required as part of the Environment Act 2021.

Again, the experience of the palm oil industry shows that it’s possible to cut out deforestation—both illegal and legal from supply chains. In the case of these voluntary NDPE commitments, High Carbon Stock (HCS)[32]/ High Conservation Value (HCV) assessments must be completed by the company using registered assessors, deploying the HCS/HCV toolkit and undergoing a peer review before any land is cleared[33]. This is outside acquiring the concession, completing any impact assessments, obtaining the necessary permits and following any other local regulations.  

Clean Supply Model – Group Level Responsibility

The abundance of evidence cited in this submission carves a clear justification for the application of a ‘Group Level Responsibility’ model for forest risk commodities. The Group Level Model applies to suppliers at their Group Level irrespective of the commodity supply chain. Should deforestation be detected in a specific supply chain, the Group level actors involved in supplying the contaminated supply would be suspended or excluded immediately at a Group Level to ensure no further chains become contaminated. This model has been successfully adopted by the RSPO (Roundtable on Sustainable Palm Oil) with great success and demonstrates the ability of business to apply Group Level Accountability to their chains.

Adopting Corporate Producer Group Level Responsibility in Due Diligence legislation would ensure mass balance certification schemes could credibly promote themselves as vDCF, as certification schemes currently mix certified product with uncertified product from producer groups still engaged in deforestation. UK retailers are using mass balance certification as a way of promising deforestation and conversion-free commodity supply. By adhering to a Clean Supply model, those producer groups who risk contamination through their ongoing involvement in deforestation, would be excluded from the supply chain until such time they could prove clean supply. This would ensure certification schemes could better scrutinise their supply and be more accurate in their estimations of the percentage of DCF (Deforestation and Conversion Free).

By applying this model to UK supply via the due diligence process, contaminated is dramatically reduced, the suspended offender is motivated to work quickly and diligently to remove the specific source of deforestation. Application of this model in UK law – alongside robust EU due diligence, will help to bring about the market sector transformation required – the Group Level. This will enable a ‘clean supply’ mode to flourish, cleaning non-UK supply chains such as China, to ensure no leakage supply chains are created as a biproduct of any UK legislation.

Enforcement and mitigation

It is recommended that the Government and Office for Environmental Protection (OEP) outline a specific Due Diligence reporting processes for each commodity and clearly articulate a consistence approach to reporting across all sectors – which includes reporting at a Group Level.

Current plans propose mitigations for environmental, economic, labour and social implications of cases of deforestation. The Environment Act 2021 outlines remedial action and financial reparation are required to mitigate breaches of deforestation, and the Government should consider outlining specific guidance, proportionate to the levels of deforestation committed to ensure adequate reversal of the impact caused. These cases, documented via a public grievance process, where enforcement is delivered in a timely fashion to avoid any further, negative impacts. It is also recommended that provision be made within the Environment Act to ensure that not only criminality related to environmental degradation via deforestation, but also land disputes, encroachment, human rights violations and labour right concerns form part of the assessment delivered by the Due Diligence mechanism. It is imperative that cases of deforestation and the associated right violations (human, labour, trade) are considered and enforced through the Due Diligence law and not via additional bills such as the Slavery Act, Finance Regulatory Acts, which would lead to complication and delay in appropriate action. Free Trade Agreements must abide by the Due Diligence process also, and Might Earth is concerned that there is a will from the Government to relax its’ commitment to deforestation and its’ own Net Zero Strategy by removing any green regulations in future Trade Deals. [34] This would have a devastated effect on credibility and legitimacy of the process.

Remedial action must be an option, where the party importing has been responsible for all actors involved in the specific, contaminated supply chain, from importers to retailers.

Do these measures target the right sectors? Given that they do not extend to all products of deforestation, are they adequate?

Timber inclusion

As a forest commodity, we believe it is imperative for the UK Government to include imported timber within the Environment Act 2021, and specifically the due diligence mechanism if the UK Government is to be able to adequately monitor its global deforestation footprint and outlined the relevant plan to reduce and eradicate.

Financial sector inclusion

HSBC was the largest British-based financer of destructive agribusiness making deals worth $6.85bn (£5.25bn).[35]  Agribusiness represents a high-risk investment given the issues associated with the sector, not only limited to environmental degradation but also deep-rooted issues including labour issues, human rights – gender and indigenous right violations, violence and murder, and a web of criminality. [36] The absence of credible Due Diligence regulation across the finance sector, has seen continued investment at a startling rate. Since 2016 - when banks pledged to curb investments of this type of and begin move the finance industry towards a greener and more sustainable model - Global Witnesses reports estimate £1.33m in income from investment since Paris. 35

It is clear financial institutions require regulatory processes within which to work for banks to:

a) better assess the environmental and human rights risks within their portfolios,

b) increase transparency to shareholders and investors and

c) move to model of sustainable banking with the necessary policies to strip out investments and financing to people, companies and projects which pose an environmental treat.

To what extent have the Global Resource Initiative (GRI) Taskforce’s recommendations on deforestation and land conversion been met by the Government?

Mighty Earth is extremely concerned about the lack of gusto and progress since the Global Resource Initiative (GRI) Taskforce’s paper was outlined, and in fact, since the Environment Bill 2021 was passed. There have been no updates or communication from Defra regarding this work – despite requests - and it is not clear how the Government aims to consult civil society during the process to adopt GRI recommendations into the secondary legislation of the Environment Act 2021. We urge the Government to adopt the recommendations from the GRI, specifically:

        Set ambitious targets, deliver through public Action Plans

GRI recommendations includes the delivery of a ‘Strategic Sustainable Commodity Action Plan,’ which has yet to be produced, as has the ambition to create an independent advisory board made-up od business, financing and civil society. A legally binding plan to end deforestation by 2030 is currently missing from Government plans. Mighty Earth would argue that 2030 targets is neither ambitious nor world beating - many UK businesses have already pledged to be deforestation-free by 2025. A 2030 target would make the UK Government complicit in deforestation for a further 13 years. Areas such as the Cerrado in Brazil will no longer exist and the damage to our global climate, as well as the animals and wildlife houses in these specific regions will be irreparable. COP27 provides an opportunity to the UK Government to bolster its work on FACT (Forest and Commodities Trade), and signatories must be pressed to deliver on the agreements made at COP26. Mighty Earth recommends the development of a public Deforestation Action Plan, adopting Accountability Framework Initiative (AFI) benchmarking to allow for public scrutiny, with the aim of building momentum behind the plan at a global level and delivering on the UK’s ambition of climate leadership on the world stage.

       Set meat reduction targets

A third of the UK population (33.5%) now have meat-free or meat-reduced diets[37]. To deliver a change across the food sector, the UK Government must adopt meat reduction targets, to drive consumer demand towards plant-based and alternative proteins simultaneously. Mighty Earth supports the GRI recommendation that targets must be laid out in the Government National Food Strategy, creating benefits not only to the environment but in driving healthy livelihoods, fulfilling the economic benefits of new, alternative protein markets and increasing domestic food security. The UK Government must play a role in securing fund for innovative technology in this area, as well removing barriers to technological advances from UK legislation. By adopting roadmaps to drive increases in the alternative protein market, the UK can reverse continuing a current trajectory and falling behind markets including China and the EU.[38] [39] The meat-alternative market is expected to grow 157% from £13.6billion to £35 billion over the next seven years, a huge business opportunity for brands who establish themselves in this space.[40]

Mighty Earth welcomes the recommendation for the UK to play a leadership role in the creation of a global approach to tackling deforestation, at home and abroad. It is necessary for the Government to implement a ‘sustainable commodity import guarantee scheme,’ to ensure small and medium enterprises (SME’s) are not disadvantaged and to create an even playing field, with an emphasis on big business playing a leading role in the delivering of vDCF supply chains.

What role can sustainable certification and Government Buying Standards (GBS), have in tackling deforestation?

Certification is one of many tools that can play a positive role in moving industry toward sustainable commodity supply. There are many types of certification, some of which move industry closer to a deforestation-free future more than others. Many soy schemes centre on a ‘mass balance model,’ which involves mixing uncertified and certified product together. While some schemes control the proportions mixed, tracked and documented, the lack of transparency in the supply chain from specific suppliers, means the actual proportion of certified product is impossible to verify or prove – and there is a huge risk of contamination of deforested supply - ultimately classed as ‘certified’ or part-certified through this mixing process. Segregated certification ensures deforestation-free product is kept separate from uncertified soy, and its journey is tracked, documented and verified. Segregated soy certification is currently the only sure way to certify 100% vDCF soy.

As mentioned above, the chocolate industry also relies heavily on ‘mass balance’ cocoa in its certification schemes – bringing many the same issue as with soy. Leaving that aside, certification only helps with some things. Certification schemes in cocoa are not all created equal, nor do they all assess the same criteria. For example, Fair Trade (FT), whilst valuable for improving community livelihoods, barely assess deforestation or climate impacts. FT also only publishes lists of its cocoa coops in one or two countries, not all countries, so lacks the necessary rigour with traceability and transparency.

Meanwhile, while other certification systems fare better on deforestation, they present other challenges. For example, Rainforest Alliance helps cocoa buyers to assess where deforestation may have previously occurred in their supply chains; they cannot help with future forecasting of deforestation to stop it before it happens. Also, while they publish information on their cooperatives and provide polygon shapefile maps for the location of all the cocoa they purchase, the traceability of RA certified cocoa is compromised because so much of it ends up in “mass balance” supply chains.
 

How can the UK Government support the private sector to reduce its contribution to furthering deforestation?

The existence of a supportive regulatory framework to prevent goods linked to deforestation from being sold in the UK would, in and of itself, help companies by creating a level playing field. By ensuring that market standards are favourable to firms that have already made strides towards deforestation-free supply chains, the UK can ensure these companies are not undercut by less rigorous competitors and prevent a potential “leakage” market for unscrupulous importers. Therefore companies pioneering on deforestation-free supply chains have come out strongly in favour of similar regulatory moves in the European Union, including, for example, leading chocolate companies.[41]

UK business have expressed support for ambitious legislation and enforcement to support the current existing efforts and expressed through a public call[42]. Mandating food and finance sectors through the adoption of markets roadmaps such as the ‘Achieving deforestation and conversion-free soy value chains’[43] is essential in driving the private sector to meet its’ public commitment on vDCF.

Business-to-business partnerships can accelerate the market towards sustainability and help to support small-holders in meeting this ambition. These pockets of good practice, paired with wider investment in sustainability mechanisms will drive forward market transformation. The Government has a role to play in encouraging green investment – by leading the markets and placing priority on those investments. Working with international partners at the micro level is the role of business, but the UK Government must adopt a more aggressive strategy and action plan for delivery of increased green investment at the macro, country level. The Government should provide learning and knowledge hubs to aid the assistance of the due diligence roll-out such as the UNDP’s Asia hub[44].

How effectively is the UK engaging with international partners to tackle deforestation?

Might Earth would welcome increased transparency reporting regarding the progress made by FACT since COP26. The Environmental Audit Committee pressed Lord Goldsmith and George Eustice MP, but there was little disclosure on progress. UK Government’s Soy Coalition Transparency has the potential to be a useful tool in moving the industry forward, it is clear however, that without a legislative mandate, progress has stifled.

Is the Glasgow Leaders Declaration on Forests and Land Use an effective mechanism for halting and reversing forest loss?

The Glasgow Leaders Declaration on Forests and Land Use can become an effective tool in bringing a wide variety of actors together to progress initiatives to reduce forest loss. Without a significant advancement in financial commitment – currently only $4 billion of the $12 billion pledged[45] – the agreement is at risk of failing, much like the 2014 agreement. The UK and other Global North countries should consider reparation payments to Global South countries to enable swifter progress and the implementation of the relevant monitoring and reporting system, essential in tackling deforestation. The UK’s reparation is estimated at $245 billion. [46]

Without clear targets for ambitious methane reduction and setting reduction targets for the meat and dairy sector, it is hard to see how the agreement can achieve its aims – considering lobbying from big agribusiness and hesitation from countries such as Brazil and Indonesia so early on after the pledge. It is clear finance is an issue for those countries with the highest forest coverage remaining and economic compensation to protect forests is required for those countries to continue to prosper, in the same way the Global North has since plundering its’ forest resource.

How can the UK ensure its £1.5bn commitment to the Global Forest Finance Pledge is used to best effect?

Mighty Earth recommends the UK Government considerable increase its contribution to FACT, to show leadership and accelerate momentum from other Global North countries, to enable progress to be made.

Recommendations for effective spending include, but are not limited to:

-          Investment in universal, third party verified monitoring systems, at home and abroad as well as bolstering grievance systems to tackle incidents of deforestation.

-          Financial support for deliver global capacity to enforcement teams such as IBAMA in Brazil, where the reduction of state support has led to reduced capacity and ability to halt deforestation in huge volumes. [47]

-          Investment in schemes that encourage use of already converted land could have more than account for the expected 5 million hectares needed by 2029. [48] It is estimated there are 23 million hectares of cleared land that is highly suitable to grow animal feed – and a further 15 million hectares of potentially soy-suitable cleared land.

-          Investment in schemes which encourage segregated supply, which includes Identity Preservation (IP) and Segregated Chain of Custody and provide financial support for associated costs.

-          Significant investment in environmental restoration projects.

-          Increased investment in a global leadership team to ensure advocacy with large importing countries, e.g. China, to ensure the UK contribution can be replicated and to reduce the possibilities of leaker to other global markets.

-          Investment to ensure Defra and OEP have the resources to cooperative with other relevant authorities to ensure European-wide supply of forest commodities can dovetail policies, systems and mechanisms wherever possible.

-          Supporting schemes which promote and protect Indigenous peoples and their human and land rights, these may be local initiatives, as well as working with Governments to support national schemes.

-          Invest in small-holder initiatives such as agroforestry which help to reduce the footprint of the UK import whilst supporting the livelihoods of Small and Medium Enterprises (SME’s).

What impact will the UK’s measures to tackle deforestation have on producer countries, indigenous peoples and local communities?

By driving out all forms of deforestation, and demonstrating this reducing demand at market level, will see the protection of forests as a priority. There are local environmental benefits, including water retention will reduce the impact of droughts, better managed natural water cycles, which in turn will benefit soil quality, reducing flash floodings and other, local environment consequences. Alternative livelihoods from firewood and charcoal/litter fall and other forest products (fruits/resins/non-timber forest product) will increase, further diversifying livelihoods, reducing our reliance on monoculture, increasing biodiversity by driving policies on non-conversion, new frontiers of deforestation. We have seen the spiralling effects of excellent initiatives such as ASM which has led to bleed into the new fronters.

Introducing clean supply model reduces ability of criminal activity, protecting local communities. By including Human Rights indicators to the UK Due diligence model, land use will be better protected and conversion in these areas will be reduced.

Tackling deforestation and placing the burden of risk and mitigation squarely with multinational corporations, will ensure that small holders do not carry the burden of delivering deforestation and conversion-free supply. By increasing transparent and effective monitoring and promoting demand for deforestation-free produce provides an even playing field for smallholders. Increased quality of product will be reflected in increased prices, which will allow small holders to invest in future sustainable practices, incentivising and creating increased wealth and health of rural communities.

September 2022