Forestry finance must be complemented by progress on transparent, traceable supply chains, experts advise


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Papua - Indonesia, 2010.

Papua - Indonesia, 2010.
This article was written by a social reporter. It has not been edited by the Forum organisers or partners, and represents the opinion of the individual author only.

Progress made towards creating sustainable practices around palm oil production won’t succeed without efforts in parallel to ensure supply chain transparency, experts at the Global Landscapes Forum have advised.

‘Up to 60% of palm oil companies are committed to sustainable practices, but there is a long way to go,’ said Annisa Rahmawati, a Forest Campaigner with Greenpeace Southeast Asia. ‘Transparency is the most crucial thing to improve at the moment.’

With reduced tenure rights, less education, less money to invest in improved practices, the huge number of smallholder farms are hard to trace and pose a challenge to company commitments to reduce deforestation.

However, complimentary to the rise in private sector commitments, there has been an explosion in transparency tools developed by NGOs, consultants and supporting organisations. These platforms are diverse; they cover risk assessments and monitoring, such as the Global Forest Watch from the World Resources Institute, an open source forest alert system.

Some companies are also leading the way towards transparency, such as the agribusiness group Wilmar, who have created their own monitoring dashboard where they invite stakeholder input.

“Five years ago, many of these platforms and tools didn’t exist. The rate at which these tools are being taken up, and the rate at which they’re being developed can only be a positive thing; companies want to understand the supply chains through which they profit are not having untold impacts,” said Sarah Hickman, Programme Manager with The Forest Trust (TFT), a global environmental charity that helps companies run responsible supply chains, at the Global Landscapes Forum.

The forum comes at a critical time, taking place alongside the UNFCCC Conference of the Parties (COP21), during which global leaders will attempt to establish an agreement to mitigate the impacts of climate change.

Although the coming years could see huge pledges of money being mobilised from the long-awaited REDD+ mechanism, unaddressed unsustainable forestry practices could hamper efforts to reduce the impact of greenhouse gas emissions from deforestation and protect local livelihoods.

“Traceability [of palm oil] is being clarified but most efforts only comprise of flows from the refiners back to the mills,” said Pablo Pacheco, Scientist with the Center for International Forestry Research (CIFOR), speaking at the Global Landscapes Forum.

He emphasised to a packed room that there are still loopholes that need closing. “The main challenge of deforestation from palm oil is the capacity to trace third party sources of supply,” Pacheco said.

The negotiations at COP21 have thus far been positive for progress on deforestation: A joint announcement by Germany, Norway and the United Kingdom saw $5 billion being pledged in support of forests through to 2020 has prompted a surge of optimism.

But for real progress, this finance will need to be integrated transparently and traceably into supply chains to benefit smallholder farmers and reduce deforestation.