Page 41 - Bulletin, Vol.80 No.2, September 2021

Companies from across industries are investing in forests, given their multifaceted
potential for risk mitigation alongside the ability to create short-, medium- and long-term
value. These are generated in three principal ways:

1. Business resilience: Investing in forest conservation and restoration today protects
businesses against the loss of natural capital and physical effects of climate change
later on, while preparing for shifting consumer and investor preferences. With many
governments set to introduce new regulations to address nature loss and climate
change, investing in forests offers an opportunity for businesses to stay ahead of these
policy shifts.

2. Business profitability and growth: The economic value of forests is vast – one
estimate suggests that the total value of intact forests and their ecosystem services is
up to $150 trillion, around double the value of global stock markets. Forest conservation
and restoration can indirectly increase core business profits, through lower costs of
capital and equity, and increased customer loyalty associated with sustainability
attributes. Investing in forests also directly generates environmental and commercial
returns, e.g. through the sale and use of sustainable forest products.

3. Values-based leadership: Strong business positioning and values-based leadership
are instrumental for businesses to build long-term value. Forest conservation and
restoration support businesses to become leaders in sustainability, strengthening
business reputation among customers, employees and ecosystem partners, including
the communities in which they operate.

Sample of corporate pledges on forest conservation and restoration.

Worldwide sample of corporate pledges on forest conservation and restoration.
Recognizing these economic benefits, businesses are already investing

Businesses that are highly dependent on forests, such as certain consumer goods and
forest products-reliant companies, are investing in forest restoration and sustainable
forest management. Such practices build resilience to key risks and enable companies
to seize new opportunities for business growth and profitability by integrating
ecologically sound and socially responsible approaches.
Companies with low direct dependencies on forests, such as those in the technology
and financial services industries, have identified opportunities to develop new products
that benefit forest conservation and restoration, and increase business profitability and
growth, while simultaneously enhancing their relationships with employees, customers
and partners.
Businesses with large greenhouse gas emissions acknowledge the need to avoid and
reduce their emissions as a priority, and are simultaneously investing in forest
conservation and restoration to mitigate and capture their residual emissions on the

What’s the World Economic Forum doing about deforestation?

Halting deforestation is essential to avoiding the worst effects of global climate change.
The destruction of forests creates almost as much greenhouse gas emissions as global
road travel, and yet it continues at an alarming rate.

40 AAFI-AFICS BULLETIN, Vol. 80 No. 2, 2021-09