Activists push back against EU’s decision to exclude banks from critical deforestation rule
![Activists push back against EU's decision to exclude banks from critical deforestation rule](https://sustainabilityeconomicsnews.com/wp-content/uploads/2024/02/1164.jpg)
Climate activists urge the European Union to rethink its choice to leave banks out of a crucial deforestation rule, aiming to avoid an official review next year.
Global Canopy, a UK-based nonprofit, argues that excluding the finance sector from the EU’s deforestation regulation was a misstep.
Citing insufficient efforts by banks and asset managers to address deforestation, Global Canopy advocates for the EU to incorporate finance into its forest protection regulations.
The organization also suggests that the US and UK adopt comparable rules.
Emma Thomson, who leads the Forest 500 and deforestation projects at Global Canopy, said, “Financial institutions have the power to transform global supply chains, but voluntary action has failed.”
“We need to see regulation,” Thomson added.
The nonprofit monitors 500 companies and financial institutions, it identifies as significant contributors to global deforestation.
Despite deforestation causing about 10% of worldwide carbon dioxide emissions, Global Canopy’s research reveals that 55% of financial firms lack policies addressing these risks.
The demand for stricter regulations follows a significant agreement at the COP26 climate summit 2021, where the finance sector vowed to help reduce global greenhouse gas emissions.
The following year, about 200 nations committed to stopping and reversing biodiversity loss by 2030 under the Kunming-Montreal Global Biodiversity Framework.
In the previous year, the EU enacted the world’s initial deforestation due diligence law, and a deal to end deforestation by 2030 was included in a United Nations Conference of the Parties agreement for the first time at the COP28 summit in Dubai.
Global Canopy emphasizes the necessity for clear rules to compel banks to ensure their financing isn’t tied to deforestation.
Niki Mardas, the nonprofit’s executive director, said on Tuesday in connection with the group’s publication of its annual Forest 500 report, “After a decade of being in the spotlight and numerous engagement attempts, it is remarkable that this group of highly-exposed companies has failed to produce a single publicly available deforestation commitment.”
“There is no solution to climate change without ending deforestation.”
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