Sustainable land use

Agriculture, forestry and land use account for 24% of the greenhouse gas emissions arising from human activity, with the majority of this coming from land use change and tropical deforestation and degradation. National governments are aware of this and preparing to take action: according to countries’ Nationally Determined Contributions to the Paris Agreement, emissions reductions from land use, land use change and forestry represent a quarter of all planned emissions reductions by 2030. Companies involved in cattle, soy, palm oil and timber are particularly likely to be affected: at least two-thirds of tropical deforestation is driven by the production of these four commodities.

Beyond climate-related risks, companies directly or indirectly linked to soft-commodity driven land use change can face reputational risks, legal risks and market access risks. Land use change also affects agricultural productivity, through a loss of biodiversity and ecosystem services, soil degradation and disruption of hydrological cycles.