Nature loss

Deforestation Debt Universe: 2025 Issuance Review

Written by Josephine Richardson, Prahalad Prasad & Johan Jarnmo

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The Deforestation Debt Universe was created to support fixed income investors in monitoring their deforestation exposure. This exposure carries real risk, from accelerating climate tipping points to destroying local biomes and disrupting supply chains. In our 2025 issuance review, we offer a detailed examination of bond market activity among entities in this universe and unpack the deforestation policies of the banks that make it possible.

The Deforestation Debt Universe currently comprises 119 issuers that have collectively issued more than USD1.6trn of hard-currency debt. In 2025, companies within this universe issued just over USD191bn equivalent across 316 securities, with a weighted average maturity of approximately nine years. Issuance was concentrated among investment-grade borrowers and predominantly denominated in USD and EUR. 

We analyse the sectoral and rating distribution of this supply, identifying trends in currency composition and benchmark exposure that are relevant for portfolio construction and engagement strategies.

We also assess the role of financial intermediaries in facilitating capital market access. Estimated syndication fees generated by banks from bond and loan issuance within the universe came to approximately USD1.08bn in 2025. We compare banks’ relative exposure to deforestation-linked activity and scrutinise the scope and comprehensiveness of their public deforestation policies, highlighting gaps across segments of the value chain.

The report then describes updated outputs from our ‘Bond Horizon’ tool, which applies quantitative methods to estimate the probability of near-term issuance by individual issuers. By identifying companies most likely to access the primary market in the coming months, the tool is intended to support fixed income investors in prioritising engagement at moments of refinancing or capital raising.

About the authors

Josephine Richardson

Josephine Richardson

Managing Director, Head of Research

Based in London, Jo leads AFII’s research and a global team supporting fixed income investors as they align their portfolios with climate and sustainability goals. She joined AFII after 18 years in fixed income markets at JPMorgan.

Prahalad Prasad

Prahalad Prasad

Associate Director, Research

Based in London, Praha covers topics including but not limited to the just transition, sustainability-linked bonds and deforestation. He previously spent seven years in Lloyds Bank’s Debt Capital Markets team.

Johan Jarnmo

Johan Jarnmo

Associate Director, Portfolio Strategy

Johan develops tools and analytics that help fixed income investors invest in a climate- and nature-positive way, including AFII’s portfolio tools Co₂liseum and FIONA. He previously worked in Deloitte’s Risk Advisory practice.

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