Environment Bill: UK businesses to be banned from sourcing through deforesters overseas

Around 80% of deforestation to date is linked to agriculture

The Department for Food, the Environment and Rural Affairs (Defra) outlined the measures this morning (11 November), following a recent consultation with businesses and NGOs. More than 60,000 individuals and organisations took part in the consultation, with 99% in favour of tighter legislation.

The changes mean that all large, UK-based businesses will need to prove that the ‘forest risk’ commodities they source internationally come from deforestation-free suppliers – or explain why they are unable to do so. Defra classes soy, palm oil, cocoa, beef, leather, rubber and forest products like wood and paper as ‘forest risk’ commodities.

Any businesses which do not comply will be subjected to fines. Defra has said it will set the “precise level” of fines in the coming months, as it wants to “move swiftly to bring the Environment Bill into force”. It has also confirmed plans to develop secondary legislation, to be introduced in late 2021 following input from COP26 attendees.

Defra has called the measures “world-leading”, but many green groups and businesses had said they wanted a stricter crackdown. The likes of McDonald’s, Nandos, Nestle, Mondelez and all of the UK’s ‘big seven’ supermarkets spearheaded calls for tighter legislation from the private sector.

“The government’s proposed law is in danger of continuing some of the most damaging deforestation, just because it is deemed ‘legal’ in domestic laws,” Global Witness’ head of forests advocacy and policy Jo Blackman said.

“Crucially, it also turns a blind eye to the money pipeline funding forest destruction by excluding the finance sector. On both these points, the UK government is running contrary to the recommendations of its own Global Resource Initiative taskforce – which earlier this year recommended the introduction of a due diligence obligation covering all deforestation for finance as well as other businesses.”

To Blackman’s point on finance, a recent report entitled ‘Bankrolling Extinction’ revealed that 50 of the world’s largest banks have collectively provided loans and underwriting worth more than $2.6 trn to the food, forestry, mining, fossil fuels, infrastructure, tourism and transport and logistics sectors in 2019. These sectors are regarded as the primary drivers of biodiversity loss.

Green Alliance similarly said it wants to help Ministers “test and strengthen” proposals, so they meet the “ultimate aim” of delivering supply chains free from deforestation and “other environmental and social harms”.

The Environment Bill returned to Parliament last week after an absence of more than 200 days. It is designed to safeguard environmental standards as the Brexit transition period comes to an end.

A nation off-track

In related news, the National Audit Office (NAO) has this week published a report revealing that the UK is unlikely to deliver against the key aims of its 25-Year Environment Plan.

The report warns that Defra has not worked adequately with other departments to “set a course for developing a comprehensive set of objectives and delivery plans” for the policy framework – even though nine years have passed since the Conservative Party pledged to leave nature in the UK better for the next generation. It states that Defra does not expect to have complete data until 2024 at the earliest.

Whitehall departments must collaborate to develop new, time-bound numerical targets for 2030 and for 2040 if this trend is to be changed, the NAO recommends. The body is also calling for the UK’s post-Brexit watchdog, the Office for Environmental Protection (OEP), to be able to scrutinise progress against the 25-Year Environment Plan.

“Some progress has been made on elements of the Environment Plan but significant action is needed across national and local government, working with business and the public, if the environmental goals are to be met,” the NAO’s lead Gareth Davies summarised.

The conclusions of the report echo recent policy briefings from the Natural Capital Committee.

Sarah George