(Bloomberg) -- The global economy won’t reach net-zero carbon emissions without putting an end to deforestation.

That’s the conclusion of the United Nations-backed Race to Zero campaign, which pushes companies and investors to reduce emissions. The report, which was published Wednesday in partnership with nonprofit Global Canopy, Science Based Targets initiative and the Accountability Framework Initiative, said companies committing to eliminate emissions by 2050 must act with urgency to stamp out tropical deforestation in their supply chains.

Cutting down trees to clear land for cattle or to sell timber is a significant contributor to greenhouse gas emissions, and banks and fund managers add to the problem by providing the financing needed to enable deforestation. Protecting and restoring forests would likely result in 18% of the cuts needed by 2030 to keep the world on track to avert catastrophic climate change, the report said.

"Companies need to go further and faster on tackling deforestation in their supply chains, as a core part of delivering on their net-zero commitments if we’re to have any chance of fulfilling the goals of the Paris Agreement and keeping warming to a maximum of 1.5 degrees Celsius," said Nigel Topping, high-level climate action champion for the COP26 climate summit.

Central to tackling forest clearance is going after companies in the timber, land and agriculture industries. Together, these businesses contribute 22% to global emissions, half of which comes from deforestation for food, fiber, feed and fuel, according to Topping.

The good news is a growing number of these companies have pledged to reach net zero by 2050 or sooner, including more than 40% of the companies that Global Canopy considers to be critical for tackling tropical deforestation. That’s a near five-fold increase from just two years ago. 

Still, progress is slow and more than 90% of these companies could be at risk of missing their net-zero commitments because of a lack of progress on deforestation, according to the report.

Investors are starting to wake up to the risks with firms, including Aviva Plc and Storebrand Asset Management, joining forces in November to commit to eliminating commodity driven deforestation from their portfolio companies. 

“Far too many of the world’s biggest companies and financial institutions continue to turn a blind eye to their role in driving deforestation,” said Niki Mardas, CEO of Global Canopy. "And those with net-zero targets won’t achieve their goals unless they start taking immediate steps to remove deforestation from their supply chains and investments.”

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