Terms of Reference

Market Research for Third-party independent Verification and Assurance of Self-reported Company Forests Data

Overview

Demand for forest risk commodities such as cattle, soy, palm oil and timber drives most of the deforestation in the world and is increasing. These commodities end up in a wide array of products that global retailers and manufacturers rely on to generate significant revenue. However, corporate sourcing and procurement practices are coming under growing consumer, investor and regulatory scrutiny because of the link with deforestation. There is increasing pressure on companies to ensure that their supply chains are deforestation-free and to report on progress to key stakeholders.

CDP’s forests program acts on behalf of 528 signatory investors, with US$ 96 trillion in assets and 13 purchasing companies who wish to understand how companies are addressing their exposure to deforestation risks. In 2018, 455 organizations responded to CDP’s forests questionnaire which asks organizations how they produce, source and use the four major agricultural commodities associated with deforestation: timber, cattle products, soy, and palm oil.

As part of a project to drive corporate action to reduce deforestation from agricultural commodity supply chains in Latin America, China, and Europe, CDP wishes to collect information on how CDP can drive and facilitate third-party independent verification and assurance of forests-related data reported by companies globally (referred in this document as ‘Verification of Forests data’).

CDP seeks a service provider for a three-month research project that will deliver this insight. Interested individuals and teams with relevant knowledge and experience are invited to send their CVs and proposals with the expected deliverables and budget by 7th of June.

This document provides an outline of the project and the expected deliverables.

Timeframe: Q2 2019

• Application and selection of service provider - early June
• Research and analysis- June and July
• Final report – End of August

Budget: The maximum budget allocation is £20,000 incl. VAT plus up to £4,000 for travel expenses.

About CDP

CDP is a global not-for-profit organization, headquartered in London with offices and partners in 50 countries. For over 18 years, CDP has been driving action by companies and cities to reduce greenhouse gas emissions, safeguard water resources and prevent deforestation.

Rationale and purpose

Verification and assurance is good practice in environmental reporting as it ensures the quality of data and processes disclosed to CDP. Questions on third-party independent verification and assurance have been asked in CDP Climate Change questionnaire for over a decade and currently, about 70% of the companies responding under the investor program are verifying their carbon emissions.

In 2018, a verification module was also added to the Forests questionnaire for the first-time asking companies if they verify any information reported to CDP and if so, which data points have been verified. However, recognizing the lack of universally applied verification standards in the forests space, CDP currently requests that companies disclose on any verification practices and forests standards used.

Currently, few companies are verifying forest data through third-party service providers. Amongst those reporting on verification practices, the majority refer to third-party audit or verifications undertaken as part of certification processes, not verification of data disclosed to CDP. Therefore, CDP has identified the need to explore additional ways to support verification of voluntary disclosure efforts, including the possibility of expanding its work to include more systematic third-party verification processes.

Verification of forests data

Third-party independent verification is a strategic aspect for companies disclosing to CDP as it provides assurance to the credibility/quality of the information provided. It can identify inefficient process areas of organizations allowing corrective action to be taken as well as providing independent evidence as to why companies should invest in improving this process. CDP supports third-party independent verification and assurance as good practice in environmental reporting since it ensures the accuracy of the data and processes disclosed.

Verification of forest data can help organizations build strong reputation in various ways:

• Increase confidence in data for internal and external use;
• Improve internal processes by identifying weak points and increasing effectiveness;
• Identifying errors and improving data accuracy;
• Reduce operational costs;
• Identifying business risks and opportunities;
• Provide credibility for products, services, and internal processes.

Objective

This project aims to undertake research on the market for verification of forests data and make recommendations on mechanisms available to CDP to support verification of data by forests disclosers. This includes partnerships with third parties which can offer verification services or any other relevant stakeholders. The findings of this research will help CDP to engage and set partnerships with service providers as well as to provide insights for the forests questionnaire development process.

Outputs

The research project will be carried out over a period of 12 weeks (from 01st June to 28th August 2019) and will be responsible for the development and submission of the following outputs and deliverables:

Product 1 (15%): Detailed work plan and methodology for the research project and a draft list of service providers, institutions and CDP staff for interviews (EXCEL format).

Product 2 (25%): Document with the results from the market research (Word format):

• An analysis of the current landscape for ‘verification of Forests data’ including the responses submitted by companies to CDP in 2018. This should contain the approximate size of the market (financial figures and number of companies);
• List and description of the main tools and measures available for verifying social, environmental, and land-use data; and
• List of the main third-party service providers operating in Latin America, North America, Europe and/or China offering verification of forest data. This should go beyond the service providers already reported by CDP disclosers.

Product 3 (60%): Document containing the recommendations to CDP (Word format):

• List of the main data points in Forests questionnaire that should be verified by companies disclosing to CDP. There should be a clear explanation of the rationale for each data point suggested as well as to how to include this new data point into the forests questionnaire.
• Measures available to companies to verify self-reported data including potential costs.
• Recommendations to CDP regarding its role in developing the forests verification market. This includes a description of the main mechanisms available to CDP to support and expand the verification of data by forests disclosures.
• Recommendations of potential partners that could support the verification service (e.g. companies, research institutes, NGOs, etc.). It is important that the list of potential partners cover the majority of geographies, from which companies currently disclose to CDP.

A report should be provided containing the results of products 2 and 3 and the incorporation of all feedback from CDP (Word and PDF formats).

This report should contain the following topics:

• Objective of the study
• Methodology
• Results from the market research
• Gap analysis
• Conclusion
• Recommendations to CDP

Annex: List of interviewees, list of potential service providers, contacted institutions, forest standards, others.

Required qualifications

The research will be coordinated by the technical and forests teams of CDP (London) with support of the Latin America team (Brazil). The study can be led by an individual consultant, research institution, NGO or consultancy company which has competencies linked to the purpose and outputs of the research.

The person responsible for this work should have the following qualifications:

• At least MSc in Environmental Management, Forests Engineering, Agriculture or related
• At least 10 years of research or consultancy experience in a related field
• Experience in forest/agricultural sustainability standards, certification and/or reporting
• Good understanding of tropical deforestation issues and links with commodity supply chains. Knowledge of cattle, soy, timber, and palm oil supply chains is highly desirable
• Experience in one or more forest-risk deforestation countries in Latin America
• Working knowledge of English and Portuguese and/or Spanish languages is mandatory

Recruitment process

The interested parties should send the following documents and budget to the following e-mail [email protected]

• Technical proposal with the curriculum vitae of the person(s) responsible for the work, expression of interest and resource capacity for execution of the work
• Financial proposal including all costs from the person(s) involved, operational costs and possible expenses with travel; value for money provided will be considered
• The title of the e-mail should be ‘Market Research for Third-party independent Verification and Assurance of Self-reported Company Data’

Deadline for submission: 7th of June

Cost and payments

Budget: The maximum budget allocation for the project is £20,000 plus a further maximum travel allocation of £4,000 incl. VAT. Please note that applicants will be assessed across both technical and financial criteria where value for money will be concerned.

The payment of the Consultant will be performed as follows:

• 15% of the fees after signing the contract and refining the work plan (Product 1)
• 25% of the fees after submission and approval of the Product 2
• 60% of the fees after submission and approval of the Product 3