Building Resilience: A Fresh Perspective on Within Value Chain Mitigation
27 May 2025 - The Rimba Journal
Imagine a company that sources its commodities from a valley where farmers have struggled with soil degradation and declining yields. Instead of simply purchasing carbon credits from a far-off reforestation project, the company invests directly in the land and people within its own supply chain.
They help farmers plant shade trees among their crops, restoring soil health and boosting biodiversity; they build water catchment systems to protect against droughts and fund education programmes to improve community resilience. The impact is visible and long-lasting: healthier farms, more secure livelihoods and a supply chain that actively regenerates the very landscapes it depends on.
This kind of ‘insetting’ approach, sometimes referred to as Within Value Chain Mitigation (WVCM), is not just a matter of corporate social responsibility—it is a financial imperative driven by market opportunities, risk management and evolving regulatory landscapes. As businesses seek to improve sustainability in their sourcing landscapes, WVCM has great potential to connect climate mitigation strategies to the resilience of supply chains. Unlike traditional offsetting, which typically involves purchasing external credits, WVCM is rooted in direct, tangible action within sourcing areas, which ultimately contributes to the long-term success and profitability of the businesses that follow this path.
However, despite the obvious potential of WVCM, a lack of clarity in its definition presents significant barriers to scaling up mitigation efforts, particularly in industries such as palm oil, where complex supply chains can sometimes complicate accountability. In this article, we explore the wider concept of WVCM, the challenges associated with defining it accurately and the need for a more sector-specific approach to its implementation. In the sometimes opaque world of WVCM, fresh perspectives can help to bring vision more clearly into focus.
Key Definitions:
Offsetting | A company buys carbon credits to make up for (or ‘offset’) its GHG emissions. The money is used to fund action somewhere in the world that removes an equivalent amount of carbon from the atmosphere or prevents it from being emitted.
Insetting | A company implements nature-based solutions (such as reforestation, agroforestry, renewable energy and regenerative agriculture) within their sourcing landscape. This approach emphasises doing more good, rather than less bad, within value chains.
[source: World Economic Forum]
The Main Benefits of a WVCM Approach
According to the International Platform on Insetting (IPI), one of the key differences between offsetting and insetting is that, while the former usually involves a one-off purchase, the latter puts a clear emphasis on long-term mitigating action. For businesses who source their commodities from production landscapes, a WVCM approach to this process offers several major advantages:
-
- Enhanced Sustainability and Risk Mitigation
A WVCM approach ensures better oversight of environmental and social impacts across the entire supply chain. It enables businesses to address deforestation, biodiversity loss, water management and labour rights, thereby reducing reputational and regulatory risks.
- Improved Supply Chain Efficiency and Resilience
By managing the entire value chain, rather than just individual suppliers, companies can optimise logistics, reduce waste and improve resource allocation. A WVCM approach fosters collaboration between different stakeholders (farmers, processors, distributors), leading to more stable and resilient supply chains. This reduces volatility in sourcing and mitigates the impact of market disruptions, climate change and geopolitical risks.
- Protecting the Integrity of Natural Assets
Another key benefit of effective WVCM is protecting the integrity of natural assets that are the foundation of businesses in commodities sectors, such as palm oil. The Rimba Collective funding mechanism offers a way for companies to pool their resources, spread the risk of their investments and strengthen their supply chains, while also delivering on their sustainability commitments.
- Connecting the Health of Nature to the Wealth of Companies and Communities
WVCM offers a strategic opportunity to integrate these conservation approaches into procurement strategies, by aligning sustainability financing with commodity sourcing. This approach not only supports environmental goals but also mitigates business risks associated with resource depletion and regulatory pressures.
They help farmers plant shade trees among their crops, restoring soil health and boosting biodiversity; they build water catchment systems to protect against droughts and fund education programmes to improve community resilience. The impact is visible and long-lasting: healthier farms, more secure livelihoods and a supply chain that actively regenerates the very landscapes it depends on.
This kind of ‘insetting’ approach, sometimes referred to as Within Value Chain Mitigation (WVCM), is not just a matter of corporate social responsibility—it is a financial imperative driven by market opportunities, risk management and evolving regulatory landscapes. As businesses seek to improve sustainability in their sourcing landscapes, WVCM has great potential to connect climate mitigation strategies to the resilience of supply chains. Unlike traditional offsetting, which typically involves purchasing external credits, WVCM is rooted in direct, tangible action within sourcing areas, which ultimately contributes to the long-term success and profitability of the businesses that follow this path.
However, despite the obvious potential of WVCM, a lack of clarity in its definition presents significant barriers to scaling up mitigation efforts, particularly in industries such as palm oil, where complex supply chains can sometimes complicate accountability. In this article, we explore the wider concept of WVCM, the challenges associated with defining it accurately and the need for a more sector-specific approach to its implementation. In the sometimes opaque world of WVCM, fresh perspectives can help to bring vision more clearly into focus.
Key Definitions:
Offsetting | A company buys carbon credits to make up for (or ‘offset’) its GHG emissions. The money is used to fund action somewhere in the world that removes an equivalent amount of carbon from the atmosphere or prevents it from being emitted.
Insetting | A company implements nature-based solutions (such as reforestation, agroforestry, renewable energy and regenerative agriculture) within their sourcing landscape. This approach emphasises doing more good, rather than less bad, within value chains.
[source: World Economic Forum]
The Main Benefits of a WVCM Approach
According to the International Platform on Insetting (IPI), one of the key differences between offsetting and insetting is that, while the former usually involves a one-off purchase, the latter puts a clear emphasis on long-term mitigating action. For businesses who source their commodities from production landscapes, a WVCM approach to this process offers several major advantages:
-
- Enhanced Sustainability and Risk Mitigation
A WVCM approach ensures better oversight of environmental and social impacts across the entire supply chain. It enables businesses to address deforestation, biodiversity loss, water management and labour rights, thereby reducing reputational and regulatory risks. - Improved Supply Chain Efficiency and Resilience
By managing the entire value chain, rather than just individual suppliers, companies can optimise logistics, reduce waste and improve resource allocation. A WVCM approach fosters collaboration between different stakeholders (farmers, processors, distributors), leading to more stable and resilient supply chains. This reduces volatility in sourcing and mitigates the impact of market disruptions, climate change and geopolitical risks. - Protecting the Integrity of Natural Assets
Another key benefit of effective WVCM is protecting the integrity of natural assets that are the foundation of businesses in commodities sectors, such as palm oil. The Rimba Collective funding mechanism offers a way for companies to pool their resources, spread the risk of their investments and strengthen their supply chains, while also delivering on their sustainability commitments. - Connecting the Health of Nature to the Wealth of Companies and Communities
WVCM offers a strategic opportunity to integrate these conservation approaches into procurement strategies, by aligning sustainability financing with commodity sourcing. This approach not only supports environmental goals but also mitigates business risks associated with resource depletion and regulatory pressures.
- Enhanced Sustainability and Risk Mitigation
Read More | In East Kalimantan, the Rimba Collective has teamed up with a local NGO called KBCF to improve agricultural practices and strengthen supply chain resilience. For an in-depth look at the positive benefits this WVCM approach is having on local livelihoods and landscapes, click here.
Defining WVCM: Key Challenges
At present, there is no universally agreed-upon definition or standardised framework for WVCM. This lack of clarity is holding back sustainability and preventing companies from achieving impact at scale. In 2023, and in response to the public draft of the Greenhouse Gas (GHG) Protocol Land Sector and Removals Guidance (LSRG), the Rimba Collective evaluated all the interpretations of WVCM to highlight discrepancies and search for clarity. Our findings revealed four major inconsistencies across different frameworks:
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- Geographical Boundaries: While some definitions restrict WVCM strictly to direct supply chains, others recognise broader ecosystem and community impacts.
- Land Tenure Considerations: Regulatory bodies, such as the Science Based Targets initiative (SBTi), often confine WVCM activities to designated production areas. However, industries like palm oil demonstrate that environmental impacts often extend well beyond plantation boundaries.
- Biodiversity and Ecosystem Services: While emissions-based WVCM has clearer definitions, biodiversity-focused mitigation lacks specificity. The International Advisory Panel on Biodiversity Credits suggests that WVCM should prioritise securing the ecosystem services that are vital to supply chain resilience.
- Supply Chain Traceability: The tangled nature of global supply chains makes it challenging to trace sustainability initiatives back to individual company actions, thereby further complicating effective implementation.
To address these challenges, a clearer and more comprehensive definition of WVCM – one that reflects the realities at ground level – is sorely needed. Without a clear and binding definition, businesses will continue to encounter difficulties in distinguishing WVCM activities. This will also make it harder to ensure compliance with evolving sustainability frameworks and justify their contributions to the resilience of supply chains.
Read more | In West Kalimantan, Rimba Collective funding is helping Tropenbos Indonesia to restore degraded lands, prevent fires, protect biodiversity and develop sustainable livelihoods based around NTFPs. Although the project area is located within a 50km buffer zone of palm oil mills, many of these community and ecosystem benefits are not officially recognised under the current definition of WVCM. To explore this initiative in greater detail, click here.
Recommendations for Strengthening WVCM in Palm Oil Supply Chains
A sustainable approach to WVCM must prioritise long-term impact rather than short-term mitigation. To ensure lasting environmental and economic benefits, immediate environmental concerns must be coupled with long-term planning for ecological resilience. This will help to future-proof conservation efforts, so they remain viable even as market dynamics shift.
Unlike temporary offsetting schemes, the Rimba Collective insetting model aims to establish and support sustainability initiatives that can deliver positive outcomes for 25 years and beyond. The adaptability of the model allows it to extend across various supply chain stakeholders, thereby broadening its impact and scalability. At the root of this development is the effective definition and implementation of a WVCM approach. Taking all of the above into consideration, the Rimba Collective has devised four key recommendations for the evolution of WVCM and its relationship to supply chains moving forwards:
- Define Clear Boundaries
- Establish a 50km buffer zone around palm oil mills as the minimum scope for WVCM interventions.
- Use watershed boundaries to define the areas where biodiversity and community well-being measures should be implemented.
- Implement Robust Verification
- Adopt, VCM-aligned methodologies, such as Verra CCB, to verify emissions reductions and biodiversity conservation.
- Develop sector-specific sustainability metrics to evaluate WVCM outcomes.
- Enhance Collaboration
- Facilitate joint investments in landscape-scale mitigation projects to increase efficiency and reduce costs to participating businesses.
- Drive consensus on best practices through industry-wide cooperation.
- Prioritise Landscape-based Solutions
- Design WVCM initiatives around ecological rather than administrative boundaries.
- Advocate nature-based solutions, such as watershed conservation and ecosystem restoration.
Read More | In North Sumatra, the Rimba Collective is working with BITRA Indonesia to restore ecosystems and rejuvenate local livelihoods through nature-based solutions. You can read more about these initiatives here.
To bring these changes to fruition, we support the development of a clearer and more practical WVCM framework, and are taking steps to make this happen. First, we are conducting spatial analyses of the Rimba Collective project portfolio to evaluate which projects align with proposed WVCM criteria and geographic boundaries. Second, we are also engaging with policy and reporting initiatives to advocate flexible, science-based definitions of WVCM that are aligned with global sustainability frameworks.
A Powerful Tool for Positive, Lasting Change
Achieving a well-defined and widely accepted WVCM framework is crucial to derisking businesses and advancing corporate sustainability commitments. In palm oil supply chains—where the interplay between environmental, social and economic factors is particularly complex—a strategic, landscape-based approach to WVCM is required. By clearly defining spatial boundaries, establishing credible verification systems, and fostering industry-wide collaboration, WVCM can serve as a powerful tool for driving positive and lasting change in commodity sourcing areas.
About the Rimba Collective
The Rimba Collective is an innovative, long-term collaboration between leading consumer goods manufacturers, NGOs and forest-dependent communities in Southeast Asia. Our aim is to protect landscapes, livelihoods and biodiversity through a portfolio of high-quality conservation and restoration projects. Over the next 25 years and beyond, this approach will achieve lasting, long-term impact at scale, with over 550,000 hectares of rich forest landscapes protected and 32,000 local livelihoods improved.
To find out more, and to join the Rimba Collective, please get in touch.