companies faced with the obligation to source their raw materials

The new European regulations on imported deforestation will apply at the end of 2024 while European imports represent 16% of global deforestation, in second position behind China.

Where does the soya imported to feed livestock come from? What about the leather in our shoes or the rubber in the tires of our cars? Companies will need to answer these questions precisely. A new regulation, which entered into force in June 2023, will soon be imposed on European companies. They will have to prove that the products they put on the market do not come from deforestation areas. The objective is thus to fight against what we call imported deforestation.

Leonardo Bonanni is a specialist in supply chains: “The law requires that all these raw materials be traced to the fields, to the forests where the raw materials come from. It’s a huge volume of data that will have to be collected and verified.” This rule will apply at the end of 2024, but companies must already specify the origin of the raw materials concerned such as livestock (leather), wood, cocoa, coffee, rubber, coal, etc. palm oil, printed paper products and soy.

Software to map supply chains

It is still necessary to identify precisely where the raw material comes from, which large groups do not necessarily know. It is indeed difficult to trace the source because there are many intermediaries. This is why Leonardo Bonanni created SourceMap, software that allows you to map, that is to say, map supply chains. “It is the buyer who will be able to capture these GPS coordinates, he explains. In general, when he goes to collect the raw material, he will have with him a smartphone that allows you to explore the perimeter of the field which will allow us to ensure that in the four corners of the plot, there has been no deforestation. .”

The teams of SourceMap will then verify this data in order to compare it to the forest protection maps. “On the map we are looking at, we have the farms distributed, in this case in Indonesiaindicates Jean-Baptistse Ceaux, director of operations of Source Map Europe. We see that the red dots are places where the satellite image has spotted a loss of trees. The interest for us is to understand why there was this loss.”

A maximum fine of 4% of turnover

If deforestation is considered active, the company may be sanctioned. The fine will vary depending on the risk level assigned to the geographic area. Thus, the maximum fine imposed will be at least 4% of the total annual turnover achieved in the European Union by the infringing operator. It is then up to the company to find a more virtuous supplier. “What has always been missing in the audits and certifications of NGOs before is that it was very easy to hide bad practices in the 99% of plots that were not audited and not visited, analysis Leonardo Bonanni. And so, with this transformation, it completely changes the buying culture and the global commerce culture.”

However, there is still a way to go as European imports represent 16% of global deforestation, placing the continent in second position behind China.