Biodiversity to the fore as billions pledged to fight deforestation
12 November, 2021
Financial institutions and world leaders pledged to curb deforestation as part of wider efforts to reduce carbon emissions and combat climate change announced at the COP26 conference in Glasgow.
More than 100 nations with 85% of the world’s forests committed to “end deforestation and reverse land degradation by 2030”. More than €10 billion in public money has already been promised to the cause, as well as more than €6 billion worth of private funds.
Ladislas Smia, head of sustainability research at Mirova, said the development was “a first positive signal”, highlighting the importance of the involvement of countries such as Brazil and Indonesia.
“We need to go even further if we want not only to avoid the negative impacts of deforestation but also to make forests an ally in facing major environmental issues,” Smia added.
Elsewhere, a group of more than 30 finance companies have committed to anti-deforestation projects aimed at reversing the damage done by agriculture-related to products such as palm oil, soy, beef and leather, pulp and paper.
The group includes Aviva, AXA, Fidelity International, Federated Hermes, Robeco, and Storebrand Asset Management. They have pledged to engage with corporates on deforestation issues, publicly disclose risks related to the practice, and increase their investment in “nature-based solutions”, according to the Finance for Biodiversity Foundation.
“The need to act on deforestation is urgent,” said Emine Isciel, head of climate and environment at Storebrand Asset Management. “Halting deforestation can make a dramatic contribution to mitigating and adapting to climate change while helping to achieve biodiversity targets.
“Deforestation is not only a risk to climate and biodiversity, it can also pose financial risks to our portfolios. A huge number of economic sectors are exposed to increasing physical and regulatory risks associated with deforestation.”
Federated Hermes’ Sonya Likhtman, who co-chairs the public policy advocacy working group of the Finance for Biodiversity Foundation, added that the prominence of biodiversity at COP26 indicated that there was “greater recognition that we need nature in order to successfully transition to net-zero economies”.
She added: “Forests, mangroves, peatlands and other biodiverse ecosystems must be protected and restored to strengthen climate change mitigation and adaptation efforts.”
Earlier this year Minerva published a free briefing on biodiversity issues as part of its Regulatory Briefings series. Click here to access.
Last Updated: 12 November 2021