MESSAGES FROM TRASTA ESG

Dear Readers,

Building a sustainable future is a responsibility we all share. In this issue of our newsletter, we bring you inspiring content that serves as a reminder of why protecting nature and managing resources responsibly is crucial. We highlight the importance of regenerative agriculture in revitalizing soil, shed light on research uncovering the realities behind deforestation, and explore ways to take action against this global challenge. As we closely follow developments in environmental, social, and governance matters, we will witness the powerful impact of both individual and collective efforts. With each issue, we continue to take eco-friendly steps forward.

Stay sustainable…

ÖZGÜN ÇINAR, CEO

ESG NEWS

  • New York state has enacted a groundbreaking climate law to hold fossil fuel companies accountable for their role in the climate crisis. Governor Kathy Hochul signed the bill into law on Thursday, introducing a $75 billion fine system over the next 25 years. The funds will be used to repair and adapt infrastructure damaged by climate change, shifting the financial burden from taxpayers to the companies deemed responsible. DETAIL
  • The Johannesburg Stock Exchange (JSE) is revamping its Sustainability Disclosure Guidance to reflect the finalized IFRS S1 and IFRS S2 standards issued by the International Sustainability Standards Board (ISSB) and new Companies Amendment Bills. DETAIL
  • ERM, the world’s largest specialist sustainability consultancy, has launched the Council on Sustainability Transformation to drive corporate progress on sustainability amid economic and political pressures. The Council brings together senior leaders from corporations, governments, and academia to offer practical strategies for achieving ambitious environmental and social targets. DETAIL
  • XDI (Cross Dependency Initiative) unveiled the XDI Climate Risk Hub at New York Climate Week, introducing a comprehensive platform for on-demand climate risk analysis across industries and geographies. DETAIL
  • The Water Efficiency Regulation, published in the Official Gazette dated 30 December 2024, foresees the implementation of a series of measures to make water use more efficient in all sectors. These measures include the establishment of Water Efficiency Systems that will ensure efficient use of water, determination of the current water use status, determination of applicable strategies, and monitoring and reporting of the process.DETAIL
  • Last year, water-related disasters claimed more than 8,700 lives, drove 40 million people from their homes and caused $550bn in economic damage, according to the 2024 Global Water Monitor report covered by the Guardian. DETAIL

🍃GREEN COLUMN🍃

DEFORESTATION and AGRICULTURAL EXPANSION in NIGERIA

The impact of climate change on agricultural activities is increasingly highlighting the importance of ESG (Environmental, Social, and Governance) criteria in shaping sustainability strategies.

A study conducted on Nigeria examines the interaction between agricultural expansion, deforestation, and climate change. The research reveals that while these processes provide short-term economic gains, they reduce carbon storage capacity and weaken ecosystems.

According to the study, approximately 42% of Nigeria’s southern forests were lost between 1998 and 2021. During this period, 25% to 31% of deforestation was linked to climate variables, such as rainfall anomalies.

Deforestation leads to the loss of carbon storage capacity while also degrading local ecosystems. The study shows that agricultural expansion occurred immediately in 59% to 68% of deforested areas, and within five years in 89% to 93% of these areas. This transformation accelerates biodiversity loss and poses a significant threat to environmental sustainability.

Forests play a crucial role in food security. The study finds a positive correlation between forest cover and children’s dietary diversity (Individual Diet Diversity Score – IDDS). However, agricultural expansion following deforestation does not offer the same benefits. According to the data, the average IDDS score for children is 3.48, which falls below the minimum dietary diversity threshold of 5, indicating inadequate nutrition quality. Only 12% of the rural communities studied meet this minimum standard. The fruits, vegetables, and other food resources provided by forests enhance food security in rural communities, whereas forest loss negatively affects dietary diversity.

The study highlights that Nigerian government policies aimed at increasing agricultural production have provided short-term economic benefits but have failed to support long-term environmental and social goals. For example, between 1999 and 2002, 91% of deforested areas were converted into farmland within five years, a rate that increased to 93% between 2003 and 2006. The weakness of governance mechanisms during this period has limited the adoption of sustainable agricultural practices.

The dynamics of agricultural expansion and deforestation in Nigeria appear to be manageable through ESG-based strategies. To reduce deforestation, investment should be made in innovative agricultural techniques that lower the carbon footprint. Agroforestry practices could help farmers generate multiple income streams while preserving biodiversity. Providing training and infrastructure support to farmers could promote sustainable methods that improve nutrition quality. Food security projects for children and women should be prioritized. Policy reforms should shift the focus from short-term economic gains to long-term sustainability objectives. Encouraging technology-driven, efficiency-enhancing initiatives in agriculture would also yield significant benefits.

This study demonstrates that ESG criteria can serve as a guiding framework not only for corporations but also for national policymakers. As seen in the case of Nigeria, balancing environmental protection, social well-being, and effective governance is key to achieving sustainable development goals. Protecting forests, ensuring sustainable agriculture, and strengthening food security are essential for realizing these objectives.

DAMLA GÜNALP, SUSTAINABILITY ASSISTANT SPECIALIST

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