Supply Chains: vital to tackling deforestation…
Leadership within corporate sustainability continues to reach new heights as companies innovate to catalyze more progress. Early sustainability efforts focused on philanthropy. Next, companies embraced the business value of engaging in operational efficiency, such as efficient use of water or energy.
The current wave? Supply chain engagement: realizing that the bulk of their environmental impact comes from outside their operational walls, leading companies are reaching back across the chain to suppliers and producers to drive improvements.
Companies and non-profit partners still have a lot of work to do to determine how to adequately engage in continuous improvement across a supply chain and measure performance in a transparent way. But even if they solve this puzzle, it isn’t sufficient to tackle our biggest, hairiest environmental problems—like deforestation.
In the deforestation space, direct supply chain engagement is vital to manage corporate risks and catalyze improvements. But any company that attempts long-term supply chain engagement on their own typically creates a situation in which individual farms are reducing forest loss, but the landscape around them is still filled with rapid deforestation. Imagine "islands of green" in a sea of deforestation.
…but what's the next step?
Enter the next stage of corporate sustainability leadership: local policy engagement. By engaging with policymakers in the core regions from which they source, companies that have zero deforestation commitments can catalyze local government-led initiatives that strive for long-term landscape scale reductions in forest loss and improvements in productivity. Companies can add a critically important voice to the policy table while providing support for local initiatives that advance their zero deforestation goals and promote those of policymakers.
Within the deforestation space, we call this type of policy engagement a jurisdictional approach. Rather than only going farm-by-farm to ensure sustainability, a jurisdictional approach allows companies to work alongside governments to create entire regions that are improving along deforestation and productivity metrics.
We see more and more companies express that they alone cannot solve the problem of deforestation, and that they will need to collaborate to scale results. Just yesterday at COP23, Walmart announced a new Forest Policy that indicates that jurisdictional approaches will need to be part of reaching its goal of zero-net deforestation:
"Walmart recognizes that no company can solve deforestation on its own and that we must leverage our ability to promote sustainable agricultural production and sourcing beyond our private brands, and even beyond our retail supply chain. We recognize the importance of collaboration with our suppliers, our peers, governments and NGOs to address deforestation and promote sustainable production at an industry level. This will require new approaches and solutions at both the jurisdictional and landscape level that drive results on the ground by engaging both governments, to improve policy and increase scale, as well as the market with clear demand signals for more sustainable products."
This is just the first step, and true engagement will take time and effort over the next several years to build relationships and drive change at scale. However, policies like this one send a strong signal: big business is looking to partner with governments to catalyze change. Companies seeking to participate in collaborative solutions are looking to governments to lead.
For companies like Walmart that have been engaging in supply chain deforestation strategies for many years, jurisdictional approaches are the next leadership step necessary to drive additional progress at scale.
Which company will be next?