A new White Paper from Systemiq calls for urgent action to address the systemic and economic drivers behind deforestation. It outlines three clear paths forward for public and private finance to make forest protection viable across global supply chains.
Global forest loss surged in 2024. Despite years of pledges and new regulations, companies and countries are still falling short.
New analysis by Systemiq for the Mobilising Finance for Forests (MFF) programme – Deforestation-Free Commodities: Investing in Deforestation-Free Supply Chains as a Strategic Imperative – was launched at London Climate Action Week. It highlights that deforestation isn’t just an environmental issue, it’s a growing business risk.
And while laws like the EU Deforestation Regulation are changing expectations for corporate supply chains, most companies still aren’t moving fast enough because the economics of deforestation still work against conservation.
For many producers, especially in emerging markets, clearing forests is more profitable than protecting them. The incentives to deforest are baked into the system – agricultural expansion, poor land tenure protections, high compliance costs, and uneven value distribution across the chain.
Our paper calls for a major shift in how public and private finance approach the issue. It estimates that $210 billion a year is needed to build deforestation-free agricultural supply chains. Current flows cover only a fraction of that, and private capital in key high-deforestation-risk commodity supply chains like cocoa, palm oil, and soybean remain limited.
To change that, the report outlines three strategic priorities:
- Make forest protection pay off. Help producers earn more from keeping forests intact—through premium pricing for verified deforestation-free commodities, early access to carbon and other ecosystem service markets, or reduced compliance and financing costs for sustainable practices.
- Cut the cost and complexity of compliance. Invest in consolidating monitoring systems and aligning standards to make sustainable sourcing easier and more credible, and to boost investors’ confidence.
- Build partnerships early. Bring together producers, financiers, and buyers to co-develop scalable, investment-ready projects in high-risk regions. Pooling risk and aligning timelines is key to unlocking private capital and shifting incentives.
Fixing deforestation in supply chains isn’t just about regulation or pledges. It’s about changing the underlying economics – through aligned incentives, joint action, and coordinated investment across the chain.
