Trade, Competition & RegulationPractice area
Deforestation-Free Commodity Supply-Chain Due Diligence
**Proposed page status:** Draft only — for legal and editorial review before publication **Field:** Trade, Competition & Regulation **Proposed slug:** `deforestation-free-commodity-supply-chain-due-diligence`
The starting point
Make the next decision with the commercial context in view.
Commodity supply chains increasingly face market-access, contractual, regulatory and stakeholder expectations concerning deforestation and forest degradation. Organisations need a coherent, evidence-led way to understand exposure, make decisions and communicate carefully across sourcing, trade and governance functions.
How we help
The work around the decision.
01
If the organisation is establishing its baseline,
map the in-scope commodities, products, entities, suppliers, origins, trade flows and destination markets; identify where the available information is incomplete or inconsistent.
02
If a risk-based framework is needed,
align governance, policies, decision rights and escalation routes with the organisation’s operating model and with relevant legal, contractual and voluntary commitments.
03
If land-origin or traceability evidence is central,
assess the information architecture for supplier declarations, geolocation or other origin data, chain-of-custody records, verification controls, retention and access. Data protection, competition and confidentiality considerations may need to be considered alongside traceability objectives.
04
If supplier terms are being introduced or refreshed,
review the allocation of information, audit, notification, remediation, suspension and termination obligations so that contractual language is workable in the supply chain and proportionate to risk.
05
If information indicates a potential issue,
establish a documented triage and escalation process that distinguishes allegations, gaps in evidence and substantiated concerns; consider investigation, engagement, corrective action and communications options as appropriate.
06
If the business makes sustainability or sourcing statements,
review the substantiation, scope, qualification, approval and ongoing monitoring of those statements before they are used with customers, investors or the public.
07
If a transaction, financing or market-entry decision is in prospect,
incorporate supply-chain and deforestation-related diligence into the relevant risk assessment, conditions, disclosure analysis and post-completion integration planning.
Context for the decision
The facts and records that shape the route.
What does “deforestation-free” due diligence mean in practice?
It generally refers to a risk-based process for identifying, preventing or mitigating, tracking and communicating about deforestation- and forest-degradation risks connected to operations and business relationships. The necessary process and evidence will vary. It should not be treated as a label that can be applied without regard to the applicable legal definition, contract, product and supply-chain facts.[1][2]
Which commodities and products should be prioritised?
Priority should be based on the organisation’s actual exposure: commodities and derived products, countries or regions of origin, supplier tiers, market destinations, business relationships and credible indicators of risk. A regulation or customer requirement may prescribe a narrower or broader scope. The EU regime is an example of a defined list of commodities and products, rather than a global rule for every commodity supply chain.[4]
Are certifications or supplier assurances enough?
They may be relevant inputs, but their significance depends on what the applicable law, contract or internal standard requires and on the quality, coverage and currency of the underlying evidence. Organisations should avoid treating any single document, representation or tool as a substitute for a proportionate assessment of the complete supply chain.
Questions, not prescriptions
What may matter.
What does “deforestation-free” due diligence mean in practice?
It generally refers to a risk-based process for identifying, preventing or mitigating, tracking and communicating about deforestation- and forest-degradation risks connected to operations and business relationships. The necessary process and evidence will vary. It should not be treated as a label that can be applied without regard to the applicable legal definition, contract, product and supply-chain facts.[1][2]
Which commodities and products should be prioritised?
Priority should be based on the organisation’s actual exposure: commodities and derived products, countries or regions of origin, supplier tiers, market destinations, business relationships and credible indicators of risk. A regulation or customer requirement may prescribe a narrower or broader scope. The EU regime is an example of a defined list of commodities and products, rather than a global rule for every commodity supply chain.[4]
Are certifications or supplier assurances enough?
They may be relevant inputs, but their significance depends on what the applicable law, contract or internal standard requires and on the quality, coverage and currency of the underlying evidence. Organisations should avoid treating any single document, representation or tool as a substitute for a proportionate assessment of the complete supply chain.
How should legal, environmental and human-rights risks be considered together?
They are often connected. The UN Guiding Principles state that businesses should carry out human-rights due diligence to identify, prevent, mitigate and account for how they address adverse impacts, and that the process should be ongoing and proportionate to context and severity.[2] A practical framework may therefore need input from legal, procurement, compliance, sustainability, operations and relevant stakeholders.
What should leadership ask for first?
A useful starting point is a concise decision paper: the supply-chain footprint; the applicable or anticipated obligations; material evidence gaps; the most significant commercial and operational consequences; accountable owners; and a staged plan with escalation criteria. The aim is an informed management decision, not an unsupported assurance of compliance or performance.
Begin with context
Put the decision into focus.
For an initial conversation, share only high-level, non-confidential context about the relevant business decision, markets, parties, documents and timetable. Do not send confidential, privileged, personal or time-sensitive material through a website enquiry.Legal information only. This page provides general legal information, not legal advice. It does not address the facts of any individual matter and does not create a lawyer-client relationship. The appropriate route, framework, timing and outcome depend on the applicable law, documents and circumstances.