Investing in corporate commodity supply chains transitions is an impactful and attractive opportunity for investors looking to deploy nature-positive capital.
To make supply chains truly deforestation-free, there must be a comprehensive approach which encompasses targeted finance, regulation, market access and enforcement. Governments, financial actors, and the private sector must act to make this happen at the scale and urgency required to meet global climate and nature goals.
On June 24th, the MFF LCIP brought together 73 investors, corporates, and government stakeholders for the “Financing deforestation-free commodities supply chains: Delivering sustainable business-growth, investment returns, and climate action” knowledge exchange in London. Held during London Climate Action Week, the event explored the roles that different actors' have in advancing deforestation-free commodity supply chains. Discussions focused on the benefits of such transitions, including greater risk mitigation, better transparency, more robust compliance and certification processes, and long-term sustainable growth in a shifting regulatory environment and an increasingly changing climate. The event also served as the official launch of the MFF LCIP research brief, ‘Deforestation-free commodities: Investing in deforestation-free supply chains as a strategic imperative’, which examines the capital needs for driving corporate deforestation-free transitions. Throughout the event, speakers and participants emphasised how investing in deforestation-free supply chain transformation can align sustainable growth and returns, in turn highlighting the key collaborative opportunities between corporates and investors to scale impact.
During the event, the expert panel, consisting of Jenya Shandina (FMO), Pedro Moura Costa (Responsible Commodities Facility), Audrey Lagauche (Touton), Michal Zrust (Lestari Capital), and Marcela Paranhos (SAIL Investments), highlighted diverse, innovative approaches to financing deforestation-free agriculture and ecosystem restoration.
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Key Offering |
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Offers subsidized and revolving credit to soy farmers in Brazil and works with results-based finance and scalability through innovative tools, such as green bonds |
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Integrates agroforestry and farmer training, focusing on landscape-level cocoa investments in West Africa, helping to navigate regulatory and market pressures |
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Private debt fund that blends capital with strategic sustainability planning, stressing commercial viability and impact at scale. Portfolio spans across the tropical forest belt. |
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Exemplifies large-scale, private-sector-backed restoration, working to embed conservation action into Palm Oil supply chains in Indonesia |
The four models discussed on the panel are examples of commercially viable financing mechanisms that can scale forest-positive commodity supply chains. The global nature of commodity supply chains means that collective action is imperative, with pre-competitive collaboration between supply chain actors being a key opportunity for driving forward solutions. In addition, the panel highlighted the need for crowding in more types of investors to scale initiatives through deployment of combinations of different types of capital and participating in tailored de-risking and risk sharing structures.
In addition, before the main session a select group of key stakeholders participated in a focused small-group technical consultation, based around the new MFF LCIP research brief. The discussion stressed the importance of collaboration, shared standards and diagnostic tools when developing bankable, scalable, and de-risked project models, while also recognising the presence of barriers to ensuring accountability in supply chains, such as gaps in measurement, reporting, and verification systems.
To read the ‘Deforestation-free commodities: Investing in deforestation-free supply chains as a strategic imperative’, research brief, please click here.
The Mobilizing Finance for Forests (MFF) program is funded by the UK government and the government of the Kingdom of the Netherlands. MFF was established in 2021 by the UK government and FMO as a blended finance investment program to combat deforestation and other environmentally unsustainable land use practices contributing to global climate change. The Netherlands’ Ministry of Foreign Affairs joined MFF as a second funder in 2024.