As a proud member of the Accountability Framework Initiative’s (AFi) coalition, CDP is delighted to mark the two-year anniversary of AFi by showcasing the collaboration between our organisations, and how beneficial aligning our Forests Questionnaire with the Framework has been not just for CDP, but in helping companies report on best practice for forest-related issues.
The single largest cause of deforestation and ecosystem conversion globally is commercial agriculture. The production of key forest risk commodities also accounts for 10-15% of greenhouse gas (GHG) emissions.
The unsustainable production and trade of these commodities present significant business risks, contribute greatly to GHG emissions, and have negative environmental impacts on land, water, and biodiversity.
The Accountability Framework initiative (AFi) was launched in 2017 as a response to NGOs calling for ‘the ethical supply chain’ – supply chains that protect natural ecosystems, respect human rights and support local communities.
Since then, those NGOs have been joined by a far wider range of organisations, investors, commodity buyers, and governments, with the Accountability Framework representing commonly recognised best practice for addressing deforestation, conversion, and human rights abuses in agricultural and forestry supply chains.
It is clear that ethical supply chains are no longer optional, but a core part of how businesses need to respond to the environment in which they operate.
As a member of the AFi Coalition, CDP collaborates with other member organisations to provide clarity on best practice for corporate reporting to demonstrate progress toward eliminating deforestation and other forms of ecosystem conversion from their commodity supply chains.
Acting on behalf of over 590 investors that represent over US$110 trillion in assets, and more than 200 large purchasing companies, CDP Forests provides a platform of action for companies to measure and manage forest-related risks and opportunities and transparently report on progress.
To amplify and clarify essential action and disclosure by companies, CDP aligned its 2020 Forests Questionnaire with the Framework’s principles, terminology, and guidance.
Through this alignment, companies that adopt the principles of the Framework will be better able to report to and score well against, CDP. Companies that disclose comprehensively through the CDP forests platform will also be reporting effectively against the Framework itself.
Because the principles of the Accountability Framework represent consensus-based best practice, these disclosures will support companies in meeting the expectations of buyers, investors and other stakeholders.
So, what are the benefits of aligning with the Accountability Framework?
The Framework provides standardised definitions of key terms so that companies know they are working towards shared, clearly defined goals. This is essential given the level of detail required in reporting elements of large, complex supply chains and operations. When they are disclosing through Framework-aligned reporting platforms like CDP, companies can trust they are doing so against these consensus-driven definitions and in alignment with expert guidance.
Companies want to show to investors and buyers that they are serious about best practice, and AFi and CDP are working to facilitate that, allowing companies to proudly demonstrate their progress.
For example, the Framework’s Core Principles advocate for effective and transparent implementation as a means to bridge the gap between company commitments and impacts. The Framework supports companies taking greater action in areas such as traceability, supplier management, responsible production and processing practices and robust monitoring.
As part of the alignment process, CDP reworked the implementation module of the Questionnaire to provide companies with the opportunity to disclose against these implementation principles, drawing particular attention to the need for companies to show the action they are taking beyond their commitments to ensure that they become a reality.
This resulted in more robust implementation questions within the Forests Questionnaire on certification, control systems, legal compliance and engagement. These give companies a golden opportunity to demonstrate the actions they have been taking to turn their commitments into real change in line with the Framework’s best practice.
Feedback has shown that CDP alignment allows companies operating in a regional context to contribute back to the Framework. Through the work of CDP as one of AFi’s partners, we have been able to gather information in a local context and collaboratively feed this back to help set best practice forest goals in a global context.
The ability of CDP to gather publicly disclosed forest data and analyse company performance against the Core Principles, particularly in high-risk local contexts, allows us to support broader understanding of performance against best practice at a global level.
At CDP, we also offer companies the facility to contact us regarding any questions they may have during the disclosure period, and we can use this information to continually improve our own Questionnaire to facilitate effective reporting.
Through the 2020 disclosure cycle, it became clear that alignment with the Accountability Framework improved companies’ understanding of terminology and expectations, which has the added benefit of improving the disclosure process for companies.
All of the outcomes from alignment have been highly beneficial to CDP; positioning us as a reliable platform for reporting best practice and helping us gather crucial data to inform key stakeholders, ensuring that we can help to guide companies towards implementing the most effective actions and allowing us to continue to make sure our Forests Questionnaire can act as the premier disclosure platform for companies reporting on forest-risk commodities.
So, what does the future hold?
The Core Principle of the Framework and the spirit of alignment are key aspects of the development of the Forests Questionnaire. As the Questionnaire develops, the guiding principles of the Framework will continue to inform the kind of information the Questionnaire seeks to gather, the practices it looks to understand and the behaviours it strives to encourage.
Last year, CDP and AFi jointly produced the benchmarking report, ‘Disclosure for a deforestation-free supply chain’, outlining the state of play in disclosure in the year prior to alignment. We are looking to build upon this and develop a deeper understanding of the benefits of alignment between the CDP Forests Questionnaire and the Framework, always looking to the future of best practice disclosure.
We are also looking ahead to greater collaboration in producing regions. This year, CDP and AFi collaborated on a series of webinars, discussing various aspects of the Framework and how they relate to CDP disclosure, specifically within Southeast Asia.
There was significant interest in the events, particularly from that part of the world, showing how regional engagement with the framework can help inform global best practice and thought leadership, with experience from a regional context.
This is particularly true for the sessions on traceability, where in Southeast Asia the number of companies with traceability systems for palm oil is high, but the number of companies that can trace over 90% of their commodity to at least a municipality level is low.
CDP values its status as a member of the AFi Coalition and continues to collaborate with AFi to help drive change, prevent deforestation and conversion, and commit to proactive action for the restoration of our forest ecosystems.
Learn more about how the Accountability Framework has been used in the two years since its launch here.