Deforestation and Conversion Free Sourcing - Climate Bonds Initiative

Deforestation and Conversion Free Sourcing | Climate Bonds Initiative

Deforestation and Conversion Free Criteria - Coming Soon!

Status: The work for developing the “Deforestation and Conversion Free Sourcing Criteria" has begun! Agri-Food transitions Criteria development has now commenced. Crop production, Livestock production, and Deforestation and Conversion Free Sourcing will be first under development and due to be available for Certification under the Climate Bonds Standard later in the year. The proposed new criteria will build upon existing Agriculture Criteria, which can already be used to certify assets and activities.
Anticipated by end of 2023.

Financing Credible Transitions (2020 White Paper) or it's short
Summary note

Transition Finance for Transforming Companies (2021 Discussion Paper) presents the hallmarks for the Climate Bonds Transition Framework

If you have technical or industry expertise in the sector and would like to collaborate in this work, reach out at agrifoodstandards@climatebonds.net.

The Agriculture Criteria are already available for use in certifications. Bonds and loans linked to eligible assets and projects will be aligned with the Paris Agreement 1.5oC limit. Get in contact with certification@climatebonds.net to start the certification process for your agriculture green bond.

Overview:

Deforestation and Conversion of Natural Ecosystems represents a key source of climate emissions and biodiversity loss driven by the current agri-food systems. Ensuring food supply chains free of deforestation and conversion of natural ecosystems is an imperative to achieve a climate-secure future and to put a stop to the loss of biodiversity worldwide.

The agri-food supply chain is behind close to 90% of the deforestation taking place in the last decades, particularly in tropical habitats that are being destroyed to satisfy a growing demand for commodity crops, in particular beef, soya, palm-oil, cocoa and coffee.

It is essential that any investment aiming to address climate change and environmental integrity consider deforestation and conversion of natural habitats. This new criteria will provide procurement guidelines for assessing the alignment of all food commodity procurement and sourcing strategies with 1.5-degree transition for the land sector, to enable food retailers and other relevant stakeholders to issue credible green finance.

This criteria will include the establishment of clear dates to limit the timeframe of deforested-links products entering global supply chains and strong guidance on traceability and disclosure requirements, in coherence with new policy regulations driving changes in the market. In particular, the new criteria will ensure consistency with EU Deforestation Regulation and guide those aiming for the EU market for early awareness and adherence.

The criteria will have a clear focus on climate and biodiversity impacts, but it will also include guidelines to ensure just transitions, including human rights and the rights of indigenous peoples. The criteria will be informed by other standards in the market and recent policy developments, with an aim to facilitate much needed progress towards food supply chains protective of climate and biodiversity.

Why It Matters: Deforestation and ecosystem conversion significantly impact climate and biodiversity. Our new criteria will serve as a procurement guide for aligning food sourcing strategies with 1.5°C climate goals, helping to green the financial sector.

What's Included:

- Clear deadlines for phasing out deforestation-linked products
- Robust traceability and disclosure guidelines
- Alignment with EU Deforestation Regulations

Focus Areas: The criteria emphasise climate and biodiversity, but also address social considerations like human and indigenous peoples' rights.

Applicability: These criteria will be used for the certification of green bonds (assets and use of proceeds) and entities and Sustainability Linked Bonds (SLBs) for all market players within the Agri-Food Supply Chain, from retailers, traders to processors and producers.