Read my Lips: It’s Not Just Carbon
Author: Gary Zed, Canada’s Forest Trust Corporation
The business case for forest restoration is not just about compensating for your carbon footprint. Business leaders and boards are now shifting how they deal with the climate agenda, looking through the lens of what their various stakeholder groups prefer to see in terms of climate action – it’s not a one size fits all solution. When making a climate investment decision for your business, the message is quite simple: what’s good for the climate is good for business, the economy, the planet and most importantly, your stakeholders.
Limiting your investment parameters to simple check-the-box solutions to sustainability not only leaves the glass half full but fails to understand the needs and wants of your stakeholders. Companies who wish to invest in multi-impact solutions should establish authentic, tangible projects, set clear targets and report on their progress to stakeholders. Canada’s Forest Trust Corporation (CFT) focuses on forest-based investing. The mission is to move past the popular “plant a tree” mentality because, in isolation, a one-tree approach often fails to bring to life the many additional benefits and opportunities from larger-scale initiatives. When a forest is planted, it produces a domino of positive effects that result in large-scale and long-term impacts.
Checking the carbon box is not a solution. Seeking solutions only through the single regulatory lens can miss one of the most powerful, holistic climate-change mitigation mechanisms – Mother Earth. The vast array of benefits created when Mother Earth is at full strength can impact everything from your supply chain to your people and the long-term health of your business. Today, being an authentic, trustworthy brand is crucial for building brand trust and, in turn, promoting customer engagement. Stakeholders, including your employees, are no longer satisfied by flowery taglines and imagery. They want to see data and hard work.
Businesses that invest in monitoring, reporting and nature-based solutions are rewarded for their efforts. Nature-based investing creates a competitive advantage that withstands stakeholder scrutiny while increasing brand loyalty. Research reveals that 82% of shoppers want a brand’s values to align with their own, and they’ll vote with their wallet if they don’t feel a match. Three-quarters of shoppers reported parting ways with a brand over a conflict in values. To avoid a mismatch, brands need to take bold steps to reduce their carbon footprint and then take positive, meaningful action to get to net zero. They must avoid generic taglines and replace them with transparent reporting and progress updates. These steps will build a resilient consumer network.
When you work with nature, everyone wins. But it’s not easy. Leaders must balance their business objectives, stakeholder values and sustainability mandates. And they should forecast where the climate agenda will be in their business strategies because being the best of class today will no doubt be just the average soon enough. Leading with good governance, diversified investments and generational thinking will improve the bottom line, reduce climate risk exposure and build stakeholder engagement. A company’s sustainability journey must be about authenticity and credibility first. Clear targets and regular reporting demonstrate progress and impact to stakeholders. Solutions like CFT’s Smart Forest are one of many that provide this transparent and turnkey opportunity for businesses. Yet, fulfilling reporting requirements is just one of many reasons why forests are smart investments. Another is the economic benefits of the short and long term. A study by the Nature Conservancy found that for every $1 invested in forest landscape restoration, there can be up to $30 in economic benefits, including improved crop yields, reduced erosion and flooding, and increased biodiversity. This alone has the potential to change lives.
Most importantly, forest-based investments protect and empower a company’s most vital asset – its people. When companies encourage employee engagement in their impact and sustainable financing investments, it is easier to achieve sustainability goals. An environmentally forward company is more likely to encourage productive, engaged, and committed work environments by fostering a sense of purpose and connection between corporate and employee values. This leads to improved morale, retention rates, health and wellness and overall success for the company.
Cone Communications found that 74% of employees say their job is more fulfilling when provided with opportunities to make a positive impact at work. A company that values sustainability and engages its employees is also more likely to attract and retain top talent. This is supported by a Deloitte survey that found 49% of Gen-Zs and 44% of millennials claimed that their personal ethics have guided their job decisions. This demonstrates the importance of sustainability in attracting and retaining the next generation of workers.
Forests also deliver on impact investing and sustainable finance to meet more than the carbon-market protocol requirements. Investing in forests has multiple impacts – ecosystem restoration, Indigenous economic development, carbon sequestration, health and well-being, the green economy, community building, and climate risk reduction. The range and scale of impact are so vast that excluding forests from your climate portfolio strategy is a risk that may, in fact, hinder your ability for long-term sustained growth.
Stakeholders expect to see nature-based solutions at the table, and forests are a practical way to build a resilient business, a committed workforce and an authentic brand. Successful corporate leaders need to understand the importance of building a transparent and credible sustainability and impact strategy that will support their business objectives, consumer trust and stakeholder engagement, all while positively impacting the planet. Through CFT’s Smart Forest programs, organizations now have the opportunity to invest in a turnkey and efficient nature-based solution that is guaranteed to deliver high-quality and multi-impact solutions.
