{"id":296093,"date":"2026-01-21T16:49:07","date_gmt":"2026-01-21T16:49:07","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/296093\/"},"modified":"2026-01-21T16:49:07","modified_gmt":"2026-01-21T16:49:07","slug":"how-deforestation-is-a-risk-for-boards-not-just-for-the-environment","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/296093\/","title":{"rendered":"How deforestation is a risk for boards, not just for the environment"},"content":{"rendered":"

January 19 – It\u2019s true: afternoon coffee runs are getting more expensive. Deforestation in Brazil\u2019s coffee-growing region has led to reduced rainfall and soil health, crop drought and lower yields<\/a>, affecting supply and pricing. This supply chain shakeup is one example of many, as deforestation and its impacts are hitting consumer wallets and company bottom lines.<\/p>\n

As C-suites finalise 2026 strategies, they are confronting a risk that doesn\u2019t fit neatly into balance sheets and which is driving up the cost of everyday commodities.<\/p>\n

While deforestation has historically been viewed as an environmental issue, healthy forests are the foundation of a stable commodity economy. Forests provide many valuable ecosystem services critical to agriculture, from water filtration to soil health \u2013 for instance, healthy soil function is valued at $11 trillion<\/a> annually \u2013 and deforestation is threatening ecosystems\u2019 abilities to deliver these services.<\/p>\n

As supply chains for companies reliant on agriculture, forests and water become more volatile, businesses face a tough choice: absorb higher input costs, hurt margins, or pass those costs on to consumers who are already tightening their purse strings.<\/p>\n

Corn cobs affected by a drought are seen on a farm on the outskirts of Buenos Aires, Argentina. REUTERS\/Agustin Marcarian Purchase Licensing Rights, opens new tab<\/a>By 2050, climate change and land degradation are expected to reduce crop yields worldwide by 10% on average<\/a> \u2013 and by up to 50% in certain regions. <\/p>\n

Leaders in the food and beverage sector recognise that the industry, whose business models are founded upon reliable agricultural inputs, is facing systemic risks that will only compound as nature degradation continues. Businesses can no longer afford to ignore the risks within and beyond their value chains. 2026 must be a year of action; it\u2019s time to invest in resiliency.<\/p>\n

In-value-chain investments are changes within a company\u2019s own supply chain that strengthen supply chain security and offer long-term cost savings. For instance, companies can scale regenerative agriculture practices to improve soil health and water retention while reducing input costs. <\/p>\n

Deforestation-free sourcing can also help companies manage exposure to climate-related disruptions and reduce regulatory, reputational, and supply chain risk. Momentum for value chain action is growing, reflecting the material need for, and benefits to, investments in more resilient supply chains.<\/p>\n

The World Business Council for Sustainable Development has worked with Nestle on scaling its regenerative agricultural practices<\/a> to materially reduce production risk. Testing and scaling practices such as crop diversification, agroforestry and improved water management in Vietnam increased yields and reduced variability, while simultaneously improving soil health and water retention. These results show how investments in nature-based solutions can protect both productivity and long-term supply security for sector leaders.<\/p>\n

Of course, climate risks are a systemic challenge that no single supply chain can solve. Beyond-value-chain investments allow companies to reduce risks at local, regional and global scales, for example by investing in forest protection or restoration projects that support ecosystem stability far beyond any single farm or project.<\/p>\n

A woman piles coffee cherries while processing them at a buying agent in Son La province, west of Hanoi, Vietnam. REUTERS\/Kham Purchase Licensing Rights, opens new tab<\/a><\/p>\n

Forests are a key pillar of ecosystem health for fields and yields. Well\u2011managed forests support vital ecosystem services such as stable rainfall, water regulation, soil health, and biodiversity, helping protect agricultural supply chains from climate\u2011driven disruptions. These interventions mitigate systemic climate risks that cross farms and project sites and sectors. For boardrooms, beyond-value-chain efforts minimise risks at the highest level \u2013 reducing the likelihood or severity of climate disruptions happening in the first place.<\/p>\n

We need to mobilise high-integrity demand for high-quality, natural climate solutions that future-proof global supply chains. This is a strategic, diversified investment in the world\u2019s forest and landscape systems that underpin long\u2011term supply security, like restoring and protecting forests, sustainably managing croplands and restoring wetlands. These wide-scale investments beyond the value chain are a meaningful complement to own supply chain initiatives, enabling companies to reduce systemic climate risk in a way that no individual intervention can.<\/p>\n

To make these investments commercially viable, however, it is critical to identify enough revenue-generating opportunities. Projects that deliver nature-based carbon credits and can be sold on the voluntary carbon market are often a strong complement to other revenue streams as the carbon market is well-placed to finance activities that do not have other sources of financing.<\/p>\n

The Natural Climate Solutions Alliance, convened by the World Business Council for Sustainable Development and the World Economic Forum, has been actively engaging companies to scale the demand for these particular type of voluntary credits in recognition of their massive potential, as they not only deliver climate mitigation outcomes but also social and nature benefits.<\/p>\n

COP30 underscored that protecting nature is a core requirement for economic stability, with negotiators elevating forest finance and high-integrity carbon markets as essential tools for global supply chain resilience. For companies already feeling the strain of climate change-driven volatility, 2026 is an opportunity for innovation and collaboration, to build prosperity within planetary boundaries, and invest directly in the ecosystems businesses depend on. Doing so is just good business.<\/p>\n

Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. Ethical Corporation Magazine, a part of Reuters Professional, is owned by Thomson Reuters and operates independently of Reuters News.<\/p>\n

Purchase Licensing Rights<\/a><\/a><\/p>\n

Giulia Carbone is a director at the World Business Council for Sustainable Development. She leads the Natural Climate Solutions Alliance, the Nature Based Solutions and the Beyond Value Chain Mitigation Workstreams. Giulia previously served as the deputy director of the Global Business and Biodiversity Programme at the International Union for Conservation of Nature for 15 years; and spent almost a decade at the UN Environment Programme. <\/p>\n","protected":false},"excerpt":{"rendered":"January 19 – It\u2019s true: afternoon coffee runs are getting more expensive. Deforestation in Brazil\u2019s coffee-growing region has…\n","protected":false},"author":2,"featured_media":296094,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[269],"tags":[87671,18,440,19,17,91402,87670,82561,87669,95609,133,15170],"class_list":["post-296093","post","type-post","status-publish","format-standard","has-post-thumbnail","category-environment","tag-destecmii","tag-eire","tag-environment","tag-ie","tag-ireland","tag-n2clm","tag-n2esg","tag-rsbideforestation","tag-rsbiindustry-insight","tag-rsbinature-based-solutions","tag-science","tag-sustainable-business"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/115934118876359950","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/296093","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=296093"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/296093\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/296094"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=296093"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=296093"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=296093"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}