PARIS - Many major global companies and financial institutions that directly or indirectly contribute to deforestation do not have any policies in place to protect forests, increasing the risk of catastrophic nature loss, a report said on Wednesday.

The report comes just months after countries reached a historic agreement to protect 30 per cent of the world’s land and seas by 2030 at United Nations biodiversity talks in late 2022.

At the same time, incoming legislation for the European Union and Britain will tighten rules around trading commodities associated with deforestation.

But new analysis on Wednesday showed that hundreds of companies still have not set a single policy on deforestation despite these high-level commitments.

These companies are at risk – financially, reputationally and operationally – if they do not take steps to reduce their role in deforestation, according to the Forest 500 analysis by non-profit research group Global Canopy.

“While there have been pockets of progress, the majority of companies and financial institutions are living on borrowed time, putting climate and nature goals at risk,” Global Canopy director Niki Mardas said.

The report found that 201 of the 500 companies and financial institutions with the most influence on tropical deforestation – 40 per cent of all companies assessed – failed to set any deforestation policies, barely unchanged from a year ago.

They included VW Group and Deichmann Group, Europe’s largest footwear retailer. Neither replied to Agence France-Presse’s request for comment.

The report assessed 350 companies with the greatest stake in forest-risk commodities: palm oil, soya, beef, leather, timber and pulp and paper. It also looked at the 150 financial institutions providing the most finance to these companies.

It found that 100 companies have deforestation commitments in place for all the commodities to which they are exposed, including Britain’s consumer goods company Unilever and Sainsbury’s supermarket.

But it said only half of these are actively monitoring their suppliers or sourcing regions in line with their own policies.

“More companies have commitments, but few are taking sufficient action to deliver on them,” Global Canopy said.

New laws in the European Union and Britain should help to propel that effort, but Global Canopy said companies need to do better – and can, with more data tools and guidance available than ever before.

“Really, 2023 is the best year there has ever been to act on deforestation,” Forest 500 lead Emma Thomson told AFP.

The report also found that the average company’s score for respecting human rights linked to deforestation fell by 7 percentage points with the addition of new indicators.

Ms Thomson said deforestation is linked to a host of abuses, from violating land rights and consent to violence and threats against human rights defenders.

“Deforestation cannot effectively be eliminated without addressing those human rights abuses,” she said. AFP