The Finance Sector Deforestation Action (FSDA) initiative has today published its FSDA Progress Report, developed by FSDA Secretariat, IIGCC, with invaluable contributions from FSDA participants, the FSDA Investor Strategic Working Group, Puninda Thind (Climate Champions Team) and Sue Reid (Global Optimism). Data for assessment of FSDA companies against the Investor expectations was provided by CDP.
The report highlights that while progress has been made by FSDA and its participants, deforestation remains a complex, systemic risk requiring continued engagement from stakeholders across financial institutions, corporate and policymakers.
Deforestation sits firmly at the nexus of the climate and biodiversity crises, accounting for approximately 11% of global greenhouse gas emissions. Ending deforestation and forest degradation is vital to mitigating climate change, halting biodiversity loss and supporting a just and sustainable economic transition. FSDA participants recognise this as integral to their fiduciary duty and to mitigating material financial risks across portfolios.
FSDA 2025 Progress Report
Over its four-year mandate, FSDA raised the bar of ambition for investors seeking to address and steward deforestation-related financial risks in their portfolios. The initiative has provided practical tools, resources, and best-practice examples that have directly informed and advanced individual participants’ activities.
Investor progress:
Engagement progress:
Corporate progress (according to CDP data):
Resources produced:
The report includes seven case studies from FSDA signatories, covering company and policy engagements, investment in nature-based solutions, developing and applying the FSDA Investor Expectations for Commercial and Investment Banks, milestone achievements, and assessing deforestation risk within individual portfolios.
Despite progress, deforestation remains an urgent challenge beyond 2025, with investor efforts continuing through IIGCC’s Deforestation Investor Group (DIG) platform to be launched in January 2026.
Stephanie Pfeifer, CEO, IIGCC: “Tackling deforestation is essential to addressing the interlinked issues of climate change and nature and biodiversity loss - and as we approach COP30, it has never been more urgent. IIGCC is proud to have supported this momentum as secretariat for FSDA, helping shape the new resources, such as the Investor Expectations for Commercial Banks and supporting FSDA signatories in their engagements across a whole landscape of stakeholders, including companies, policymakers and data providers. IIGCC will continue to champion and mainstream action on deforestation, ensuring our members have the tools and support they need to manage risks and opportunities associate with deforestation, and advance real progress across the financial system.”
Dan Ioschpe, COP 30 Climate High-Level Champion: “As the Global Stocktake highlights, halting and reversing forest loss by 2030 requires action across multiple stakeholders, from policymakers and investors to companies and producers, Indigenous peoples, and local communities. Four years in, FSDA has led the way in increasing awareness and action among private finance to address commodity driven deforestation. I welcome this progress and the next steps with the Deforestation Investor Group to accelerate investor action on deforestation.”
Christiana Figueres, Founding Partner, Global Optimism and Former Executive Secretary, UNFCCC: “As underscored by this 2025 Finance Sector Deforestation Action (FSDA) Progress Report, the foundations for transformative action are stronger than they have ever been. FSDA signatories have shown what is possible. They have mapped their deforestation risk exposures, have adopted and are implementing credible policies, and are tracking and reporting on progress. In so doing, they have helped to catalyse shifts in government policy, market expectations, and global supply chains – bringing us closer to a world where economic progress no longer comes at the expense of forests or the people who live in and depend on them.”
Investor support
Boston Common Asset Management: “This progress report is a reflection of the work of the FSDA and its investors in articulating specific but actionable steps companies including banks can take to tackle deforestation. We look forward to seeing the expansion of this work through the Deforestation Investor Group to continue with the progress we need to see by 2030 in halting and reversing this key financial risk.”
Church Commissioners “FSDA has been instrumental in helping investors strengthen their approach to deforestation risks, raising ambition and spurring practical action across the sector. Although progress is being made, deforestation continues to both harm the climate and threaten financial stability. The Deforestation Investor Group offers an important next step - mainstreaming investor action and accelerating meaningful change.”
Régia Capital: “Through the development of policies, peer learning, and collaborative engagement, the FSDA has supported investor practices aimed at mitigating portfolio risks related to deforestation. This progress is also reflected in the actions of engaged companies, which have increased their disclosure on deforestation-free commodity volumes and supply chain traceability. Despite the progress made and the decline in deforestation rates observed in some biomes, the challenge remains complex, and continued commitment is essential to achieving the goals of the Paris Agreement and protecting long-term economic value.”
About FSDA
The Finance Sector Deforestation Action (FSDA) brings together 30 financial institutions representing USD 7.5 trillion in AUM/A who committed to use best efforts to eliminate agricultural commodity-driven deforestation risks in their individual investment and lending portfolios by 2025. IIGCC has served as the FSDA’s Secretariat since September 2024.
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About IIGCC
IIGCC is an investor-led membership organisation with 400+ members across 20+ countries. We bring the investment community together to navigate the risks and opportunities of the transition and support progress towards a net zero and climate resilient future.
We work with our members to create guidance, tools, frameworks and resources that can help them, in their individual contexts, to manage climate-related financial risk within their individual portfolios. Our work also supports investors to make the most of opportunities presented by the transition towards a decarbonised global economy and the realities of a changing climate.
Through our leading work, we help investors to navigate implementation of climate considerations in their individual portfolios, advocate for a more supportive policy environment, and provide them with the tools to undertake effective stewardship and engagement with companies, and the wider market.
More information at www.iigcc.org
Media contact
Sara Trett, Communications Officer, IIGCC
E: strett@iigcc.org
T: +44 (0)7436 16122