How Strategic Forest Restoration Can Tackle Climate Change and Drive Economic Growth
At the 2024 Climate & Sustainability Leadership Summit, Yishan Wong, CEO of Terraformation, delivers a powerful message on the untapped potential of investing in forest restoration to combat climate change and drive sustainable economic growth. Drawing from his background in Silicon Valley, Wong outlines why restoring biodiverse forests represents one of the most scalable and effective strategies to sequester carbon, support biodiversity, and generate long-term financial returns.
Wong’s perspective is both pragmatic and visionary. “I’m a tech guy who’s all in on trees,” he says. Having built and scaled global platforms like Facebook and Reddit, Wong now applies his engineering mindset to the urgent challenge of climate change. “If we can solve problems at scale in tech, why can’t we do the same for nature?”
A Scalable Solution: The Power of Forest Restoration
Wong emphasizes that forest restoration is not just an environmental initiative but a solution that meets the growing demand for carbon capture at scale. "When it comes to climate solutions, trees are simple, affordable, and available right now,” he asserts. But Wong isn’t talking about planting any trees; his focus is on restoring biodiverse, native forests, which outperform monoculture plantations in terms of resilience and carbon sequestration.
“Forests are ecosystems, not just rows of trees,” he explains. Monoculture planting, which has been a popular but flawed approach, fails to address the need for resilience in the face of pests, disease, and climate-related pressures. “What we need are resilient, biodiverse forests that can withstand the environmental challenges we’re facing,” Wong says. Native forests, with a variety of species working in harmony, provide long-term carbon storage and help rebuild ecosystems that have been degraded by deforestation.
Addressing Bottlenecks in the Forest Economy
While the benefits of forest restoration are clear, Wong acknowledges that several bottlenecks have historically slowed progress. “The problem isn’t that we don’t know how to plant trees—we’ve been doing it for millennia. The issue is doing it at scale, fast enough to make a meaningful impact on climate,” he says.
Wong explains that Terraformation’s Forest Accelerator program is designed to overcome these obstacles. By addressing gaps in funding, seed availability, and technical expertise, Terraformation equips local forestry teams with the tools they need to launch high-quality reforestation projects. “We’re not just planting trees; we’re building ecosystems,” he emphasizes. This approach has already led to millions of trees being planted across five continents, with projects that create jobs and provide new income streams for local communities.
Financing Nature: Moving Beyond Traditional Models
One of the key barriers to scaling forest restoration is the traditional project-by-project financing model, which Wong says is inefficient and slow. "There are billions of dollars ready to be invested in nature-based solutions, but the current approach is holding us back," he points out. Wong advocates for a shift toward portfolio-based financing, which diversifies risk, accelerates capital deployment, and allows for faster project execution.
“Imagine this: instead of funding just one forest project and waiting for years to see if it works, you invest in a portfolio of projects,” Wong says. This approach spreads risk and ensures that even if one project faces challenges, others can succeed, delivering more consistent impact. “It’s about getting more projects off the ground, faster,” he adds, noting that this model is crucial for achieving the scale necessary to combat climate change effectively.
Unlocking the Value of Carbon Credits
A major component of the forest restoration economy is the growing market for carbon credits. Wong highlights that the voluntary carbon market is rebounding, with new, high-quality projects meeting stricter standards. "Carbon credits are not a get-out-of-jail-free card for polluters—they’re a way to quantify real environmental impact," he says. High-quality carbon credits, especially those tied to reforestation projects, offer businesses and governments a tangible way to offset emissions while directly funding environmental restoration.
Wong stresses the importance of distinguishing between different types of carbon credits. "There are reduction credits, avoidance credits, and removal credits," he explains. "The highest quality and most impactful are removal credits, which sequester carbon by restoring degraded land." These credits not only address climate change but also offer co-benefits such as biodiversity restoration and income generation for local communities.
Despite their value, Wong notes that projects generating removal credits make up only 5% of the current carbon market. "There’s a huge opportunity here for investors willing to support early-stage reforestation projects," he says. These projects provide long-term, measurable benefits and represent a key strategy for addressing both environmental and financial sustainability.
A Collaborative Approach: Scaling Impact Through Partnerships
Wong is quick to emphasize that scaling forest restoration requires collaboration across sectors. “No one can do this alone,” he says. Terraformation partners with local forestry organizations, indigenous communities, corporations, philanthropies, and governments to address the bottlenecks in the reforestation supply chain. By providing these stakeholders with the necessary resources—such as seeds, training, and financing—Terraformation ensures that projects are not only initiated but sustained over the long term.
“What makes a forest restoration project high quality?” Wong asks. The answer lies in long-term thinking. “These forests need to last 40, 50, even 100 years. That means using science, technology, and local knowledge to ensure the survival and resilience of the forest,” he explains. Transparency is another critical component, with each project designed to meet rigorous regulatory standards and provide clear, measurable outcomes in terms of carbon sequestration and ecosystem restoration.
Why Forests Are the Future of Climate Investment
For Wong, the case for investing in forests is clear: it’s not only an environmental imperative but also a significant financial opportunity. “Forests provide a high return on investment—not just in terms of carbon credits but in the broader economic and societal benefits they deliver,” he says. These benefits include job creation, biodiversity support, and enhanced resilience to natural disasters like floods and droughts.
"Forests are the planet’s infrastructure," Wong explains. "By investing in them, we’re investing in the future stability of our climate, our ecosystems, and our communities." He highlights that forest restoration offers a unique blend of immediate impact and long-term value. "This isn’t just about adding another asset to your portfolio—it’s about betting on a stable, sustainable future."
A Call to Action for Leaders
Wong closes his presentation with a call to action for business leaders, policymakers, and investors. “We’re living through one of the most consequential eras of human history,” he says. "The decisions we make today will shape the world for decades to come." He urges leaders to act decisively, not just to address the immediate climate crisis but to invest in a future where ecosystems and economies can thrive together.
The opportunity, Wong stresses, is enormous—but the window to act is closing. "We don’t need to wait for the next technological miracle to save us from climate disaster," he says. "Nature is already here to help. Forests are capturing carbon, creating jobs, and restoring ecosystems. All they need is the capital and the human willpower to scale."
Wong’s message is clear: investing in forests is an investment in life itself. And the time to act is now.
