Case study: Schroders commits to deforestation-free portfolios by 2025, following Forest 500 assessments

Asset management company, Schroders, has made a strong commitment to deforestation-free portfolios by 2025, following the Forest 500 assessment.

Global Canopy’s Forest 500 identifies the 350 companies and 150 financial institutions with the greatest exposure to tropical deforestation risk, and annually assesses them on the strength and implementation of their deforestation and human rights commitments.

Asset management company, Schroders, has been in the Forest 500 every year since 2014, so has consistently been one of the financial institutions with the greatest ability to influence deforestation. In 2021, Schroders scored 4% for its action to eliminate deforestation from its portfolio.

At the end of 2021, Schroders joined the Finance Sector Deforestation Action (FSDA) and committed to use their ‘best efforts’ to eliminate commodity-driven deforestation from their portfolios by 2025.

In the 2022 Forest 500 assessments, Schroders increased their Forest 500 score to 50% – an increase of 46% over 12 months.

In October 2022, within Global Canopy’s Forest 500 assessment period, Schroders published a new policy, which featured a strong commitment to “eliminate forest-risk agricultural commodity-driven deforestation in the companies held in their investment portfolios by 2025.

This policy covers all new and existing financing activities, of all company and deal sizes and also seeks to address human rights abuses associated with commodity-driven deforestation. Commodities covered include palm oil, soy, cattle products, and timber.

The policy covers both illegal and legal commodity-driven deforestation given the prevalence of inadequate legal protection for forests in numerous countries and the challenges associated with distinguishing between legal and illegal deforestation.

This case study was originally published in the Forest 500 report.