The Business of Planting Trees

The report identifies a growing "restoration economy" where businesses generate financial returns by improving the ecological function of degraded landscapes. It categorizes these opportunities into four main investment themes: technology, consumer products, project management, and commercial forestry. Through case studies of 14 companies across eight countries, the authors illustrate how various models—from drone-based reforestation and climate-smart credit for smallholders to sustainable timber and bamboo plantations—can scale. The document highlights that while significant market opportunities exist due to government pledges and rising resource demand, investors face hurdles such as high transaction costs, low liquidity, and insecure land tenure in developing regions.

• The emerging "restoration economy" consists of a diverse range of business models that provide financial returns while restoring degraded forests and agricultural lands, with some companies growing rapidly, such as one that expanded from 110 to 450 employees in 18 months.
• The report identifies four primary investment themes in land restoration: technology (improving efficiency and lowering costs), consumer products (linking sales to restoration), project management (end-to-end implementation), and commercial forestry (sustainable timber on degraded land).
• Technological innovations are reducing the high upfront costs of active restoration. For example, drone technology can plant seeds up to 150 times faster than traditional hand-planting, and specialized products like the 'Cocoon' can increase young tree survival rates from 0–20 percent to 75閕 percent in arid lands.
• Consumer-facing business models are creating new funding channels for restoration by integrating it into their core value proposition. Examples include search engines using ad profits for reforestation and apparel companies planting 10 trees for every product sold.
• Project management firms are increasingly essential for handling the logistical complexity of restoration, often driven by government mandates. In the U.S., compensatory mitigation requirements generate an estimated $3.8 billion annually from restoration and conservation activities.
• Sustainable commercial forestry on degraded land offers significant returns; impact investing funds in the timber sector produced internal rates of return (IRRs) of 5.9 percent compared to 3.3 percent for conventional timber funds between 1997 and 2014.
• Distributed plantation models, where supply is aggregated from smallholder farmers, are particularly promising in Africa to meet wood demand without destroying natural forests. In Kenya, this model can provide a local family with two to seven years' worth of baseline annual cash income from a single harvest.
• Bamboo plantations represent a high-productivity alternative to traditional timber, as bamboo can be harvested repeatedly for up to 40 years and stores more carbon than similar-sized tree species.
• Mixed-species plantations can increase wood production through a "diversity dividend," as a 10 percent loss in tree diversity in natural forests typically leads to a 3 percent loss in wood production.
• Significant systemic barriers hinder the restoration economy, including the market's failure to fully value biodiversity and carbon sequestration, government subsidies for conventional agriculture that incentivize land degradation, and long investment horizons of 10–20 years.

APA

Faruqi, S., Wu, A., Brolis, E., Ortega, A. A., & Batista, A. (2018). The Business of Planting Trees. World Resources Institute. https://wriorg.s3.amazonaws.com/s3fs-public/business-planting-trees_0.pdf

Chicago

Faruqi, Sofia, Andrew Wu, Eriks Brolis, Andrés Anchondo Ortega, and Alan Batista. The Business of Planting Trees. World Resources Institute, 2018. https://wriorg.s3.amazonaws.com/s3fs-public/business-planting-trees_0.pdf.

Wikipedia

{{cite report |last1=Faruqi |first1=Sofia |last2=Wu |first2=Andrew |last3=Brolis |first3=Eriks |last4=Ortega |first4=Andrés Anchondo |last5=Batista |first5=Alan |title=The Business of Planting Trees |publisher=World Resources Institute |date=2018 |url=https://wriorg.s3.amazonaws.com/s3fs-public/business-planting-trees_0.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{faruqi2018business, author = {Faruqi, Sofia and Wu, Andrew and Brolis, Eriks and Ortega, Andrés Anchondo and Batista, Alan}, title = {{The Business of Planting Trees}}, institution = {World Resources Institute}, year = {2018}, url = {https://wriorg.s3.amazonaws.com/s3fs-public/business-planting-trees_0.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }