TOPSHOT - Aerial view of an area of Amazon rainforest deforested by illegal fire in the municipality ... More of Labrea, Amazonas State, Brazil on August 20, 2024. . (Photo by EVARISTO SA / AFP) (Photo by EVARISTO SA/AFP via Getty Images)

In boardrooms around the world one critical threat remains off the radar as risk managers fixate instead on geopolitical shocks, supply chain disruptions, and inflation. And that rarely prioritized issue is global deforestation. Despite trillions of dollars at stake, forest destruction—and the corporate role in driving it—is still widely treated as a peripheral issue. The majority of companies continue to treat deforestation as somebody else’s problem, not a material business risk.

However, the 2024 Forest 500 report from Global Canopy exposes this neglect, revealing a widening gap between corporate promises and actual progress. Nearly half of the companies assessed have pledged to eliminate deforestation by the end of 2025, but only a small minority are on track. With the deadline only months away, consequences for failure remain unclear.

The World Bank has warned that deforestation could cause economic losses of $2.7 trillion a year by 2030, undermining carbon storage, crop yields, and ecosystem stability. In Brazil, Amazon degradation could cut agricultural output by $3.5 billion a year. In some developing countries, GDP losses could reach 20%.

These losses stem from procurement decisions made by powerful companies. The Forest 500 tracks firms linked to beef, soy, palm oil, timber, cocoa, coffee, leather, and rubber—commodities responsible for over two-thirds of global deforestation. While profits are internalized, the social and environmental costs of disaster response, healthcare, and food insecurity are shifted onto the public.

Ultimately, these risks rebound in the form of regulatory fines, reputational damage, and supply chain shocks. In this context, the illusion of profit collapses when the true cost of deforestation becomes visible on the balance sheet. What once looked like efficient margin management increasingly appears as unmanaged risk exposure.

Only 3% of the companies assessed have strong, fully implemented deforestation policies. Another 22% show limited progress, while the remaining 75%—including 168 companies—have no public commitments at all..

“The leading companies have published evidence of adequate implementation for all their commodities, taking credible steps to monitor their impacts, engage suppliers and report progress, alongside having strong deforestation commitments in place for all of their commodities too,” Emma........

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