Trase’s supply chain mapping balances scale and data resolution. Our methods to link points of production, via trading companies, to places of import build on an enhanced form of material flow analysis called Spatially Explicit Information on Production to Consumption Systems (SEI-PCS) originally developed by Godar et al. 2015.
As part of the Trase product offering, Trase Finance uses publicly available and vendor-procured data to map the financing and ownership of the trading companies involved in the trade of commodities covered by Trase.
Trase Finance uses the information on company sourcing patterns and associated exposure to deforestation risk supplied by Trase’s subnational supply chain maps to assess the exposure of financial institutions to deforestation risk. It quantifies the deforestation risk exposure of financial institutions (and other minority shareholders) holding equity investments in commodity traders.
The deforestation risk mapped in Trase Finance is only a partial picture of a financial institution’s deforestation risk based on their exposure through their direct financing of commodity traders mapped by Trase Earth. In some cases the data is not available to tell us who a company’s lenders are and how much capital is devoted to forest-risk activities. Data gaps in financial flow data (particularly in terms of debt and for private companies) and the limited subset of companies and commodities mapped mean that their total exposure to deforestation risk is likely to be much higher. Please see https://trase.finance/methodology for the detailed methods and data sources.
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