FILE PHOTO: An aerial photo shows cattle grazing in a deforested area during an anti-deforestation operation by agents of the Brazilian Institute for the Environment and Renewable Natural Resources (IBAMA), near Porto Velho, Rondonia state, Brazil | Photo credit: UESLEI MARCELINO
That includes $72 billion provided to the beef, palm oil, soy, rubber, timber and paper industries in the past 18 months, according to data collected by Forests & Finance since the Paris Agreement was announced in 2015.
“This really shows that the financial sector is not aligning its financial flows with the objectives of the Paris Agreement,” said Stephanie Dowlen, one of the report’s authors. “And that was something they were obliged to do.”
The comments come ahead of the United Nations COP30 climate summit in Brazil, where world leaders are meeting this week. “It is clear that forest protection cannot be achieved by financing the same old chainsaw economy,” the Forests & Finance report said.
The increase in lending coincided with a decrease in the landmass covered by rainforests.
According to Global Forest Watch, a platform run by the nonprofit World Resources Institute, the global loss of tropical and boreal forests, which play a key role in removing carbon dioxide from the air, accelerated last year with a record 6.7 million hectares of destruction. More than half of the loss was related to fires exacerbated by record heat.
The banks that hand out the most money to so-called forest resource companies are based in Brazil, led by Banco do Brasil SA. The lender has provided nearly $8 billion in credit to the sector in the first nine months of this year, Forests & Finance notes.
Banco do Brasil did not respond to a request for comment.
Asset managers are also allocating more capital to the area, increasing their shareholdings in forest resource companies by $7.8 billion over the past decade to about $33 billion at the end of September, the report said. The pulp and paper industry received the largest inflows, followed by palm oil companies.
This year, equity investments in deforestation-related sectors have increased at asset managers such as BlackRock Inc., Vanguard Group Inc. and State Street Corp. The three companies are the world’s largest index fund managers, which helps explain the increase because their funds must invest in all companies included in the benchmarks.
BlackRock and State Street declined to comment, while Vanguard did not respond to a request for comment.
Forests & Finance is part of a group of campaign and research organizations that includes Rainforest Action Network and Amazon Watch. The report calls on governments to support financial regulations that make it ‘illegal’ for banks and investors to profit from deforestation and human rights abuses.
“What is needed is for governments to really step up and regulate the financial sector, because the incentives really need to change,” said Dowlen, Forests & Finance campaigner at Rainforest Action Network. “Right now it’s just too lucrative to profit from deforestation.”
More stories like this are available at bloomberg.com
Published on November 5, 2025
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