Finance sector
Strategic data and insights for finance sector initiatives
Forest IQ
Trase data helps power Forest IQ – a new tool to help banks and investors understand their deforestation exposure.
Forest IQ provides market-leading data about corporate performance on deforestation, conversion of natural ecosystems and associated human rights abuses.
Storebrand Asset Management
Trase worked with Storebrand Asset Management to demonstrate how investors can identify and assess deforestation risk in their portfolios to inform engagement and divestment activities.
The complexity of agricultural production and supply chains creates a barrier to more effective investor action. Commodities such as cattle, soy and palm oil are being sourced from land recently converted both legally and illegally, but investors are often unaware of these links and how they are consequently financing climate change and biodiversity loss.
Due diligence for deforestation-free finance
Trase worked with partners to develop guidance for the finance sector on how to eliminate deforestation in their loans and investments.
The finance sector can be exposed to deforestation risk through their business relationships with clients or holdings that are directly involved in the production, processing, or procurement of forest-risk commodities, or finance these activities and commodities.
Trase data enables banks and investors to conduct due diligence on clients to identify and mitigate exposure to deforestation risks.
Screen loan books and investment portfolios to understand and manage exposure to deforestation risk.
Use Trase data to challenge commodity trading companies on their policies and performance on deforestation.
Understand asset-level deforestation risk using Trase’s geospatial data.
How reliable is Trase data?
The Trase approach uses data from dozens of different sources including official government data on production, tax, and shipping, as well as data on supply chain logistics freely disclosed by industry associations and on the websites of commodity trading companies. Our aim is to produce the most accurate supply chain maps possible using publicly available or purchasable data. Trase is dedicated to clearly communicating the limitations of the data within our methodologies and in the tool itself. We encourage users to visit our terms of use and review our methods documentation to fully understand the strength of Trase data and the limitations to its use and to contact us directly via info@trase.earth with any questions or feedback.
How does Trase calculate deforestation exposure?
Commodity deforestation exposure is a measure of the extent to which supply chain actors (companies, countries, investors) are exposed to commodity deforestation due to their sourcing patterns. This is expressed in terms of an area of deforestation (hectares) that a supply chain actor is exposed to. This is calculated by allocating the commodity deforestation estimated at the jurisdictional level (see above) to supply chains, in proportion to the volumes of commodity traded from that jurisdiction by a particular actor. For all commodities where we have calculated this metric, the name of the commodity replaces the word ‘commodity’. For example, commodity deforestation exposure becomes soy deforestation exposure or cattle deforestation exposure as appropriate.
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