26 August 2021

Press Release

For immediate release

Due diligence law to tackle deforestation must be strengthened

New report shows proposed UK law targeting only illegal deforestation in UK supply chains risks having limited impact and would be difficult to implement and enforce.
UK government urged to expand scope of new legislation, as part of wider efforts to eliminate all deforestation and land conversion – legal and illegal – from UK supply chains.
Deforestation and other devastating change to natural ecosystems threatens traditional and Indigenous communities, as well as species including the giant anteater and giant armadillo.

Ahead of the Environment Bill returning to the House of Lords in early September, a new report from WWF has found that laws proposed by the UK Government to help eliminate deforestation in UK supply chains risk being ineffective, unless the scope of the legislation is widened.  

Due Negligence examines plans in the Environment Bill to make it mandatory for large companies to carry out due diligence checks to ensure there is no illegal deforestation in their supply chains of forest-risk commodities and derived products. The proposed measures will still allow products that result from legal deforestation, or devastating change to other natural ecosystems, to be sold in the UK.

The analysis highlights the complexity of assessing legal versus illegal deforestation: although satellite imaging can identify whether an area has been cleared, it cannot prove whether that action was legal or illegal. On top of this, complex legal frameworks in producer countries and limited data transparency mean it is often difficult to determine whether a plantation that has been created at the expense of forest and other natural ecosystems has been done so legally. This makes the proposed UK due diligence regulation extremely difficult for companies to comply with, and the UK government to enforce in practice.

The report further suggests that one potential consequence of the legality model is that producer countries may weaken legal protections on forests and other natural ecosystems, putting more habitat under threat. One of several controversial bills (PL 2633/20) currently going through the Brazilian Congress, which would give amnesty to land grabbers who have illegally invaded and deforested public lands, already shows this trend. In Indonesia, the Omnibus Law passed in 2020 has paved the way for the legalisation of plantations located on land that was previously not designated for oil palm plantations.

The calls to strengthen due diligence measures in the UK’s flagship Environment Bill sit alongside WWF’s push for the Government to adopt a legally binding target to slash the UK’s global environmental footprint by 2030.

Katie White, Executive Director of Advocacy and Campaigns at WWF, said:  

“Nature is our ally in the fight against climate change. To protect it, we must drastically reduce the UK’s global environmental footprint, not least by ensuring we aren’t adding to the destruction of precious habitats like the Amazon and Cerrado.

“The law proposed by UK government to stop deforestation isn’t yet robust enough and must be strengthened if it is to prevent further destruction of natural ecosystems – whether legal or illegal.

“This must sit alongside a legally binding target to slash the UK’s global environmental footprint by 2030. Ministers have promised to protect nature and ensure a safe climate for future generations – we won’t forget should they fail to deliver.” 

Spatial analysis of the areas in Brazil that supply soy directly to the UK shows that over 2.1 million hectares of natural vegetation – an area equivalent to just over the size of Wales – could potentially be legally converted under current laws. Even more would be threatened if the remit of ‘legal’ deforestation was further expanded. Of this 2.1 Mha, according to the most likely scenarios, the report estimates that UK imports of soy from Brazil between 2021 and 2030 could directly result in the conversion of 36-59,000 hectares of that vegetation, storing 18-30 million tonnes of carbon – and much of this (over 70%) could be done legally.

The report also shows that narrowly focusing the legislation on forest habitats rather than all natural ecosystems also increases the risks for both people and wildlife. Many of the areas that supply the UK with soy are classed as savannah, the predominant vegetation of the Cerrado region of Brazil and home to 5% of world’s biodiversity, including over 12,000 plant species, 856 species of birds and 466 species of reptiles and amphibians – a third of all species found there are unique to this region. 

In the Brazilian municipalities directly exporting soy to the UK, the giant anteater, the brown howler monkey and the giant armadillo are among the 619 plus species impacted by habitat destruction, of which deforestation and conversion are amongst the main drivers. Small rural producers, Indigenous and other traditional communities are also affected by ongoing deforestation and conversion, regardless of whether it is legal or not.

In addition to strengthening legislation in the UK, WWF highlights the responsibility of companies to deliver on their policies and commitments to eliminate all deforestation and ecosystem conversion and human rights abuses, across their entire supply chains. At the same time, the conservation organisation is calling on financial institutions to adopt rigorous screening and monitoring processes to ensure that lending and investment do not contribute to environmental damage. 

As president of the upcoming COP26 climate conference, and convenor of the Forest, Agriculture and Commodity Trade (FACT) Dialogue, the UK has an opportunity to demonstrate environmental leadership and bring other nations along towards transformative solutions to halt deforestation and land conversion. 

ENDS  

NOTES TO EDITORS  

Full report available here.

WWF’s Due Negligence report was produced with support from 3Keel and Environment Systems.
It examines the feasibility and consequences of the plans in the Environment Bill to make it mandatory for large companies to carry out due diligence checks to ensure that there is no illegal deforestation in their supply chains of forest risk commodities and derived products.
Land conversion is defined as 'change of a natural ecosystem to another land use or profound change in a natural ecosystem’s species composition, structure, or function.
Brazil is the second largest source of soy to the UK market, after Argentina. The UK imported 465,341 tonnes of soy directly from Brazil in 2018, requiring 132,382 hectares of land to produce. 
An average of 1.2 million tonnes of palm oil, palm kernel oil, derivatives and palm kernel meal were imported into the UK every year between 2016 and 2018. Forty-two per cent of this came from Indonesia, either directly or embedded within imported manufactured goods, making Indonesia the predominant supplier of oil palm products to the UK. 
The Environment Bill is currently in the House of Lords at committee stage and is expected to pass into law by the end of 2021. Relevant secondary legislation will be developed over the coming year. 
Included within the Environment Bill is a draft deforestation due diligence regulation, which would place a mandatory requirement on companies above a certain size to conduct due diligence to ensure that the forest-risk commodities that are imported into the UK are not associated with illegal deforestation. Legality would be defined by producer-country regulations governing the protection of forests and other natural ecosystems. 
The wording and design of the deforestation due diligence regulation has critical implications for its implementation and effectiveness. The impact of the regulation will be affected by factors including how due diligence, deforestation and conversion are defined, the nature of the requirements on companies, the type and the size of companies, the ecosystems and commodities covered, the sanctions or incentives, and the measuring and enforcement of compliance. Much of this detail will only be set in secondary legislation once the Environment Bill has received Royal Assent.

WWF is calling on the Government to: 

Broaden the due diligence regulation to cover all conversion of natural ecosystems (legal and illegal).  
Broaden the scope of the due diligence regulation to cover all commodities that are associated with deforestation and land conversion.  
Ensure that effective, dissuasive penalties for non-compliance are in place and enforceable.  
Ensure robust environmental and social standards in trade policy, including core environmental standards.  
Encourage other countries to adopt due diligence and other measures to halt deforestation, conversion and human rights abuses in global supply chains.

Full details of WWF’s proposed amendments to the Environment Bill are available here.

A WWF report – Thriving Within Our Planetary Means (July 2021) – outlined the UK’s disproportionately high impact on climate and nature, and called for an ambitious target to slash the UK’s global environmental footprint – the impact of everything we produce and consume – by 75% by the end of the decade. 