Forests key to addressing the effects of climate change says London CIV

London CIV has announced it considers forests as key allies to achieving three key stewardship themes.

The first is to combat the effects of climate change, through absorbing one third of the CO2 generated by fossil fuels each year. They are also critical to help balance the climate. As deforestation and land use change are responsible for 25% of global emissions, forestry helps to protect the climate.

The second theme is grounded in human rights, as 25% of the world’s population rely on forests for their livelihood. Deforestation displaces indigenous people and results in land grabbing and child labour, making forestry an important component of social impact in addition to environmental.

The third theme is biodiversity, 80% of which is land based and found in forests, making them an essential part of ecosystem services targets and objectives.

The statement from London CIV said: “Over 100 world leaders, including the UK have agreed to end and reverse deforestation by 2030 during the COP26 climate summit. The countries backing up the pledge cover approximately 85% of the world’s forests. As institutional investors, we have the obligation to use our influence to ensure companies in our portfolio have procedures and policies in place to mitigate deforestation in their operation and supply chains.”

London CIV signed the COP26 commitment letter on eliminating commodity-driven deforestation, but acknowledges that there are limitations concerning data for assessing deforestation.

However, it has found that 5.92% of its assets under management are exposed to companies on a list derived from an initial mapping of companies “most influential in driving tropical deforestation” using the Forest500 database.

Earlier in the year, London CIV joined LEAF Coalition, launched on April 22 to support tropical and subtropical forest jurisdictions to make substantial reductions in their emissions from deforestation.

As of November 2022, LEAF Coalition had received more than $1.5 billion in financial commitments for the purchase of high-integrity emissions reductions credits.