Food industry commitments to end deforestation by 2020 will not be met, according to a new report that reveals a growing gap between companies’ ambitions and targets.
The report from CDP. formerly the Carbon Disclosure Project, analyzed 22 food companies facing financial and operational risk related to Forest Risk Commodities (FRCs), including palm oil, soybean, cattle and paper, which are linked to deforestation. The companies were ranked based on exposure and response.
In addition to missing the deadline set by the Consumer Goods Forum’s resolution to achieve zero net deforestation by 2020, no company has complete traceability of palm oil and cattle to plantation/farm of origin, the report said.
In fact, 45 percent of companies reported revenue dependencies of at least 20 percent on palm oil. Disclosure lags for cattle and soy; cattle as much as 400 times and soybean oil 8.2 times more land intensive than palm oil.
“Current certification and traceability systems are not effectively addressing the issue of deforestation,” the report said. “Certified volumes account for just 20 percent of global palm oil production.”
Nearly 90 percent of the world’s palm oil production is concentrated in Southeast Asia in low-lying land vulnerable to coastal flooding. “This could lead to further deforestation inland, price volatility or high price differentials between certified and non-certified products,” the report warned.
Of the 22 companies, only eight use regenerative agriculture or landscape-style approaches as part of land use management practices, the report said.
“Due to their proximity to the consumer they face risks to their reputations from commodities linked to deforestation with potential risks to revenues,” the report said.
Horizon Organic milk brand parent company Danone ranked number one, followed by Nestle, Unilever, Kellogg Co., Mars and PepsiCo – singled out as leaders in the CPG sector for farm-level sustainability efforts.
Tyson Foods, Restaurant Brands International (Burger King owner), and Kraft Heinz were at the bottom of the rankings as they exposed to land-intensive cattle and perform weakly on FRC disclosure, according to the report.
Read the report here.
CDP’s League Table of companies in the consumer goods sector: