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The myriad of environmental and social impacts associated with deforestation— from biodiversity loss to land rights violations to climate change— pose material financial risks for companies and their investors. The main goal of the Paris Agreement is to reduce climate change by focusing on greenhouse gas emissions. Deforestation is responsible for as much as 10 percent of all global warming emissions. How is this? Most trees–and certainly those in forests–absorb carbon dioxide and then release oxygen, storing the excess carbon. When trees are cut down and burned or simply allowed to rot, that carbon is released into the air as carbon dioxide. This decoupling of population growth and deforestation is more complex than changing sectoral composition of the economy. Improved transport networks stimulated commercial agriculture, permitting specialized production based on local conditions. Improved agricultural technologies shifted major production to areas suitable for mechanized cultivation and adjusted agriculture to land capability, permitting the abandonment of marginal lands. Industrialization pulled people off the land and shifted energy supplies from wood to coal and later to other fossil fuels. In the latter half of the twentieth century, forest plantations have contributed to the forest transition, although they contribute only 3 percent to the world’s forests at the beginning of the twenty-first century “sunflower and confederate flag bedding set”
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