How are the Forest 500 companies’ scores calculated?

This explainer answers the questions we are most commonly asked about our score calculations. For full details on the assessment methodology, including social considerations and overall approach indicators which aren’t covered in this explainer, please refer to our company assessment methodology on our website.

Background

The Forest 500 companies are selected because they are the most influential companies in forest-risk supply chains based on their exposure to one or more forest-risk commodities - soy, palm oil, beef, leather, pulp and paper or timber. 

They are assessed each year on the strength and implementation of their deforestation commitments and scored accordingly, based on an average of more than 190 indicators. The Forest 500 company methodology is aligned with the Accountability Framework Initiative’s (AFi) Common Methodology. You can find out more about the best practice outlined by the AFi here.

To find out more about the individual indicators used in the assessment process, see the Forest 500 company assessment methodology.

Companies receive a score for overall approach and a score per commodity, which together provide a total score (see table below).

Contents:

Calculating the total score

• What is a ‘powerbroker’ commodity?

Calculating a commodity score

• Commitment strength indicators - 2.1, 2.2, and 2.3
• Scope of commitment strength indicators - 3.1, 3.2, 3.3
• Monitoring and implementation - differences between upstream and downstream companies

Calculating the total score

Companies are given a score for each commodity in their supply chain, and they are given a score for their “overall approach” which looks at a company’s overall approach on deforestation including a company-wide deforestation commitment and whether or not there is a high-level management position focused on deforestation.

If a company is only assessed for one commodity, these add up to give a total of 100. 

When assessed for multiple commodities, a company’s commodity scores are averaged for a score out of 84 (with scores weighted for the powerbroker commodities - see below) and then added to the score out of 16 for the overall approach. 

What is a ‘powerbroker’ commodity?

Companies are selected based on their exposure to at least one of the forest-risk commodities. Where a company has significant exposure to a commodity, it is considered a ‘powerbroker’ for that commodity because of its role and influence in that supply chain. For example, a palm oil processor would be a powerbroker for palm oil, but would also be assessed for exposure to pulp and paper in packaging if it also produced packaged goods. 

Companies can be a powerbroker for multiple commodities if they have significant exposure to more than one (see our Selection methodology).

Powerbrokers are also assessed for other forest-risk commodities in their supply chain as they are expected to take a holistic approach to their deforestation-risk. 

But because companies have greater influence over the supply chains and commodities they are powerbrokers for, the ‘powerbroker’ commodity scores are worth twice as much as the scores for other commodities when calculating the total score.

This average commodity score is then added to the overall approach score to give a total score out of 100.

Calculating a commodity score

Commitment strength indicators - 2.1, 2.2, and 2.3

There are three indicators that look at the strength of a company’s deforestation commitment. Collectively, these indicators (2.1, 2.2, and 2.3) add up to 16 points for each commodity. 

These indicators look at whether the company has a commodity-specific deforestation commitment (2.1), whether High Carbon Stock and peatlands are protected in palm oil supply chains (2.2 for palm oil), whether the company has a commitment to reduce the use of virgin wood pulp in paper production (2.2 for paper), and whether the company has a commitment to trace the commodity back to a point where they can check compliance (2.3).

Because indicator 2.2 only applies to palm oil or pulp and paper, other commodities are only assessed on indicators 2.1 and 2.3. These indicator scores are therefore increased to create a total possible score of 16.

For commodities which are assessed on all three indicators, 2.1 (the deforestation commitment indicator) is scored out of 8, and 2.2 and 2.3 are scored out of 4 respectively.

For commodities which are assessed on only two indicators, 2.1 is scored out of 10, and 2.3 is scored out of 6.

Scope of commitment strength indicators - 3.1, 3.2, 3.3

The scope indicators (3.1, 3.2, and 3.3) look at how a company applies its 2.1, 2.2, or 2.3 policy throughout the supply chain - looking at whether it applies it to all sourcing regions and suppliers (3.1), whether it has a target date (3.2) or an interim target date for achieving its commitment (3.3).

For a company assessed for all three indicators, the total of the scope indicators (indicators 3.1, 3.2, 3.3) and the score for 4.1 and 4.2 (reporting on and verifying progress for the commitment) are averaged across the available commitment strength indicators - equalling a total of 12 points.

Thus, the commitment strength section of the scoring methodology is made up of 16 points for the commitments themselves, and 12 points for the scope of the commitments, equalling 28 points for the commitment strength section.

Monitoring and implementation - differences between upstream and downstream companies

Companies are also assessed on different implementation indicators depending on where within the supply chain they operate.

Producers and processors are classed as upstream companies, and so are assessed on indicators 4.9, 4.10, and 4.12. These three indicators - which look at whether the company conducts environmental and social impact assessments, whether they report their sourcing regions/processing facilities, and whether or not they monitor their own operations for compliance - add up to a total of 12.

Traders, manufacturers, and retailers are classed as downstream companies, so are assessed on indicators 4.11, 4.13, 4.14, and 4.15. These four indicators look at whether the company reports a supplier list, monitors their suppliers for non-compliance, engages with any non-compliant suppliers, and whether or not they report a list of their non-compliant suppliers, adding up to a total of 12.

If a company is only upstream or downstream for the commodity, they are only assessed for the applicable indicators, with the group of indicators adding up to 12. 

If a company is both upstream and downstream for the commodity, for instance if they both produce soy and manufacture animal feed, they are assessed on both sets of indicators. In this instance, the total score for each indicator is halved, meaning that the indicators are still worth a total of 12 as a group.

To find out more about other indicators, see the Forest 500 company assessment methodology.

View company scores here.

Image: Pok Rie, Pexels