The financial sector faces growing pressure to cut support to companies involved in deforestation. With researchers arguing that banks are in a unique position to encourage sustainable practices among clients and across supply chains,
John Basquill examines how emerging technology is opening new opportunities for trade finance lenders looking to go green.
Deforestation remains a major challenge for financial institutions, particularly those involved in supporting exports from rainforest-covered areas of South America.
Though most lenders have overhauled policies on environmental issues, researchers continue to uncover examples of companies involved in forest destruction – either directly through their own activities or indirectly through their supply chains – that are still heavily financed by major banks.