TIMBERCHECK™

The LEAF Coalition was launched on April 22, 2021 in Washington, DC. It stands for “lowering emission by accelerating forest finance”.

Initial participation includes the governments of:

• Norway
• United Kingdom
• United States

And the following corporations:

• Amazon
• Airbnb
• Bayer
• Boston Consulting Group
• GSK
• McKinsey
• Nestlé
• Salesforce
• Unilever

What will the LEAF Coalition do?

The LEAF Coalition will pay jurisdictions in tropical countries for reducing deforestation.

The way these payments will be made is as follows….

1. Jurisdictions will submit proposals to reduce deforestation through forest protection programs to Emergent by July 22nd, 2021. Contracts are expected to be awarded by the end of 2021.
2. If a jurisdiction is awarded a contract, ART will verify whether the jurisdiction actually reduced emissions by reducing levels of deforestation and forest degradation, or restoring forests.
3. The emission reduction (ER) credits will be brokered by Emergent to ER credit buyers (presumably the governments and corporations in the coalition).
4. The funds from the sales of the ER credits will be paid to the jurisdictions. According to the Coalition “Payments will be made on delivery of results for performance in the years 2022 through to 2026.” (According to Emergent job postings, the first credit transactions are estimated to be in early 2022.)

The jurisdictional approach

The jurisdictional approach is a key component of the LEAF Coalition’s strategy.

But does it work?

The Brazilian state of Mato Grosso is often cited as a proof-of-concept of the jurisdictional approach. However, in the latest period for which data is available, 37% of the forest area logged in the state was illegal. In fact, it’s hovered around the 40% mark since the decade prior.

So why is the largely untested “jurisdictional approach” front and center in the LEAF Coalition initiative?

EDF and the jurisdictional approach

The Environmental Defense Fund (EDF), a government contractor, is a champion of this approach and appears to be the de-facto administer of the LEAF Coalition initiative.

According to the Senior Vice President of EDF, Nathaniel Keohane, the EDF set up the LEAF coordinator, Emergent, in 2019.

“EDF, working with partners, helped to establish ART. EDF set up Emergent in 2019, because we saw the need for a new, innovative financing facility that could catalyze transactions for high-quality tropical forest protection credits at scale.”  

EDF statement from Nathaniel Keohane, Senior Vice President, Climate – April 22, 2021

“Emergent” control of the LEAF initiative

Emergent will administer the LEAF Coalition initiative. This means…

• Emergent receives the proposals for contracts.
• The emission reduction credits are to be verified by ART – also set up in part by the same group that set up Emergent (being EDF).
• Emergent will then broker the sale of the ER credits between the jurisdictions, and the buyers.
• Emergent, as the administer of LEAF, will be involved in channeling the funds to jurisdictions.

It also appears that Emergent will choose what those funds can be used for and how jurisdictions can spend them.

During the media launch of this initiative, Emergent stated a short list of things that “forest countries” who receive payments could use the payments for…

Questioning the social sustainability of LEAF

It’s hard to see how an initiative set up this way can succeed for several reasons…

1. The jurisdictional approach is largely untested.
2. The organizational structure of LEAF seems built on conflicts of interest.
3. The opacity of the initiative at the start is not reassuring.
4. Operationally, on the ground, reducing deforestation requires funding before, not after forest cover increases.
5. The jurisdictional approach risks dividing communities, because its channel through local governments who often lack the support of large percentages of the population.
6. The involvement of foreign government (and NGO) entities in the forest conservation of local communities frequently undermines the credibility of conservation as just another means of foreign control over natural resources.

Transparency of LEAF contracts

If the LEAF initiative is to work, at minimum, the transparency that governments and NGOs have demanded from the private sector with regards to capital flows should be applied to all LEAF contracts.

More specifically, the following information needs to be available to the public: how these contracts get awarded, the data used in the ER verification process, the ER transactions, and the dispersement of funds to jurisdictions.

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