This feature is adapted from https://www.thepeakmagazine.com.sg/interviews/koltiva-eudr-regulations/
As the world increasingly acknowledges the impact of climate change, which is partially driven by deforestation, the European Union sets up new regulations for companies. From December 30th, this year, the EU Deforestation Regulation (EUDR) will be enforced.
This regulation requires companies to examine their products closely and ensure that these do not contribute to deforestation. This regulation also affects far more companies than one might initially expect. Correspondingly, agriculture and supply chain traceability company Koltiva has just launched its EUDR solutions programme, a three pronged approach that specifically aims to cater to companies affected by the EUDR, from producers to retailers.
Why deforestation is a big deal
Between 2010 and 2020, there was an average net loss of 4.7 million hectares of forests per year, primarily caused by deforestation. Deforestation is a huge issue because it has several multi-prong effects.
The most easy to understand is it’s impact on biodiversity. 70% of land animals and plant species live in forests, so deforestation literally rids the homeground that these other organisms live in.
Deforestation also contributes to climate change on multiple fronts. As most learn in primary school, trees are able to photosynthesis and take in carbon dioxide and convert it into oxygen. Carbon dioxide is a greenhouse gas, a gas which lingers in in the planet’s atmosphere and keeps heat circulating on the planet. Presently, we have an excess of greenhouse gases and this has resulted in global warming, which has brought climate change with it. The direct effect of deforestation is a reduction of a natural carbon sink that absorbs these excess greenhouse gases.
An indirect effect is that the soil previously shielded by trees is exposed to the sun, resulting in the soil releasing carbon under the sun’s rays — carbon that oxidises into carbon dioxide, contributing more greenhouse gases to the atmosphere’s excess.
Stringent rules and strict regulations
In the present day, the effects of global warming and climate change are increasingly hard to ignore. Besides the more obvious rise in temperatures, there has also been an increase in climate related disasters and more importantly, their impact on people.
Such reasons likely drove the EU to implement regulations on deforestation, where operators must collect documents and information providing that their products are deforestation-free and legal. These regulations apply to products commonly grown on agricultural land made from deforestation — sometimes illegal deforestation — such as palm oil, cattle, soy, coffee, cocoa, timber, rubber, and their derivative products.
If these products were cultivated illegally, on land deforested after 31st December 2020, or are not traceable, companies will not be able to sell them in the EU market. Even storing or shipping EUDR compliant products together with non-EUDR compliant products can cause companies to lose the EU market; if regulation compliant and non-compliant products are stored together, the entire shipment will be considered non-compliant and cannot be placed on the EU market.
In other words, companies must collect intricate data on their product origins, implement risk mitigation measures like audits, and report on their processes and maintain their documentation for at least five years.
What this means for companies
A large number of industries will have to follow these regulations, including the food, construction, and beauty industry, the latter of which uses palm oil in numerous cosmetic products.
As the December 2024 deadline approaches quickly, businesses must act swiftly to ensure they are prepared for the EUDR. However, these new regulations present some companies with a unique opportunity.
KOLTIVA
One such company is KOLTIVA, a start-up from Indonesia that provides businesses with the technology to trace their supply chains, so that businesses can adhere to regulations and consumer demands that increasingly prioritise transparency in corporations.
The company’s location in Indonesia will undoubtedly be an aid, as they are located in the country that produces the most palm oil in the world (59%) and that has been increasingly cracking down on its rampant illegal logging. This positions the company well — being in the country will likely help them ensure that the numerous supplies obtained from Indonesia are regulated and they might have some aid from their government.
With the soon to come changes in the EUDR, the start-up recently launched its EUDR Solutions plan, which is tailored for businesses and enterprises, involving a three step programme: KoltiTrace, KoltiSkills, and Koltiverify.
Intuitive names
These names all denote their function; KoltiTrace provides businesses such as retailes with a traceability system to use for data collection, risk assessment, deforestation verification, and a due diligence statement. KOLTIVA also has remote sensing expertise in the traceability tech platform and deforestation maps that provide historical data on tree cover loss, enabling in-depth analysis and enhancing the accuracy of deforestation detection and monitoring.
An example of KOLTIVA’s land use tracker that provides historic data on tree cover loss for data analysis and to detect deforestation.
Since companies also have to ensure that no illegal practices are conducted, be it related to logging, human rights issues, and tax issues, KOTIVA also has KoltiSkills, an upskilling programme offered to producer companies to help them implement more sustainable sourcing initiatives so as to avoid facing any problems with issues such as land legality. This mainly targets EUDR non-compliant or fagged farmers and hopes to help them adopt better practices.
Lastly, KoltiVerify is primarily for manufacturers by helping them verify their supply chain data based on EUDR compliance to help produce EUDR analysis reports.
Manfred Borer, CEO and Co-Founder of KOLTIVA, said, “We view that the EUDR is more than a regulation; it’s a mission, a key element of the European Green Deal, driving climate neutrality by 2050. By adhering to the regulation, businesses contribute to the global fight against deforestation, a significant factor in climate change and biodiversity loss.”
“We stand ready to provide expertise, technology, and services to ensure regulatory adherence while concurrently fostering a sustainable future.”
Original Writer from The PEAK: Jamie Wong
Writer for KOLTIVA's website: Steven, Public Relations & Event Officer
Editor for KOLTIVA's website: Boby Hermawan Arifin, Head of Digital Marketing
About the writer:
Steven is a dynamic professional with a keen interest in the realm of public relations and event management. With his experiences orchestrating projects, public relations campaigns, and events, Steven brings a wealth of experience and expertise to the table. His assertive communication skills are a standout feature, allowing him to adeptly foster strong connections and cultivate meaningful relationships with both internal stakeholders and external partners.
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