Global investors set deforestation and equality targets for farming and agriculture assets

The Good Food Finance Network’s High Ambition Group features 11 influential investor institutions and has today (27 October) unveiled a tranche of new ESG targets covering more than $113bn in existing assets.

The Good Food Finance Network is convened by UNEP, WBCSD, EAT Foundation, Food Systems for the Future and FAIRR. Seven of the group’s members have published new public targets on areas regarding zero deforestation, carbon removal and gender equality. The financial firms are Rabobank, Nuveen Natural Capital, Signature Agri Investments, Global Environment Facility, Phatisa in Mauritius, Norwegian firm Yara and FIRA from Mexico.

With the WWF’s latest ‘Living Planet’ report warning that the average population size decline for wildlife globally now sits at 69% since 1970, the coalition of businesses are setting new public targets to try and avert these trends. The organisations have attempted to set credible, time-bound targets aimed at creating a sustainable food system.

Rabobank will deliver a programme with an ambition of sequestering 150 megatons of CO₂ per year by 2030, equivalent to the annual emissions of 40 coal-fired power stations. Rabobank will also publish a climate target aligned with the UN-convened Net-Zero Banking Alliance (NZBA).

Rabobank will also aim to support 15 million smallholder farmers in developing countries to be supported in the transition to agroforestry, while Yara will aim for 150 million of hectares of farmland to benefit from more precise digital tools. The likes of Signature Agri Investments and Nuveen Natural Capital are aiming to deliver zero deforestation portfolios.

Elsewhere, FIRA will aim to grow its $350m climate adaptation and resilience portfolio by 5% year-on-year, starting in 2023, and increase the amount of finance funnelled into adaptation and resilience to $540m by 2030. This will be supported by a taxonomy developed with the Carbon Trust.

The Global Environment Facility (GEF) will restore 420,000 hectares of degraded land, improve land management practices in over 20 million hectares, mitigate 223 million tons of CO2 and reduce the use and waste of chemicals of “global concern” by 21 million tons by 2030.

Phatisa will aim to ensure that 100% of its portfolio companies across sub-Saharan Africa have gender policies in place and targets to increase female employment by 2025.

Nuveen Natural Capital, which currently has around 1.2 million hectares in assets under management will, by 2023, update an existing zero deforestation policy across all of its product lines.

All targets will feature short and long-term targets stretching to 2023. The UN Environment Programme (UNEP) has welcomed the announcement and has called on the wider investor sector to “supersize its ambition” when it comes to financing sustainable agriculture.

Eric Usher, Head of UNEP Finance Initiative, said: “From digital tools to zero deforestation this new generation of high ambition targets can enable a cleaner greener food and agriculture sector. There is still a long way to go and the wider finance sector must use COP27 to supersize its ambition and grow a more sustainable food and agriculture sector.”

The coalition has confirmed that further targets will be introduced across a set of 14 environmental and social themes in the months ahead. Members will continue to work on labour conditions, food security and waste and biodiversity and regenerative agriculture.

The companies will monitor the results of the global biodiversity treaty, expected to be formally adopted at COP15 in December, as well as the research and developments of the Taskforce on Nature-related Financial Disclosures (TNFD).

The progress of the GFFN High Ambition Group will be discussed during COP27.

The announcement comes in the same week that companies with combined annual revenues of $1.5trn called on world leaders to mandate that all large businesses and financial institutions should assess their impacts and dependencies on nature by the end of the decade.

The call to action is being made ahead of the UN’s 15^th Biodiversity COP (COP15) in Montreal this December. Its chief aim is to develop and implement a post-2020 biodiversity treaty for the world, with a headline ambition to halt nature loss this decade.

One of the proposed treaty targets is the need for nations to agree to protect 30% of their lands and seas for nature by 2030. Measures regarding corporate mandates are also under discussion, including a proposal for all large businesses and financial institutions to assess and disclose their impacts and dependencies on biodiversity, by 2030. This mandate could be implemented by nations in a manner similar to existing climate reporting requirements.

Supporting the inclusion of this proposal in the final treaty today are more than 330 corporates and financial institutions, convened by Business for Nature. Those in support of the call span from 52 countries, with the UK being the most-represented country in the cohort.