Global AgInvesting Sustainability Workshop

Agspring and The Freshwater Trust had the honor of facilitating an agricultural supply chain sustainability workshop at the 2015 Global AgInvesting conference.

In preparation for the workshop, potential attendees were surveyed about key areas of interest.

Key findings from our survey:

  • Nearly all respondents indicated their organization would benefit from better factual context around the environmental drivers for sustainable agriculture.
  • A strong majority of respondents wish to represent that ag investments they touch are socially responsible and deliver quantifiable results.
  • A majority indicated that sustainability factors matter when evaluating opportunities in the ag sector.

As an investor, what key environmental impact questions would you like to see better addressed?

(consolidated responses topics)

  • Which ESG KPIs are most important to track/which have the highest impact on risk/return?
  • How should we think about benchmarking?
  • Toxicity, water usage, soil pollution and erosion
  • Use of water, pesticides
  • Water availability and pollution
  • Genetic drift
  • Soil conservation
  • Biological diversity
  • Improved farmer socio-economic conditions
  • Conflict between food and water
  • Developing markets and the right to farm
  • How positive environmental impacts lead to better economic results
  • Impact of beef production on the environment – beyond simplistic claims about methane and water and able to differentiate between different production systems
  • Long term impact on local communities especially farm laborers

What specific ag sustainability topics do you feel need improved collaboration within the supply chain?

(consolidated response topics)

  • GHG emissions
  • Improved nutrition
  • Reduction in waste/spoilage
  • Social rights – labor and property
  • Land recovery and mitigation
  • Sustainability of meat
  • Measuring and addressing land/soil degradation
  • Tracking carbon impact and water use throughout the supply chain
  • Traceability and food quality

During the workshop, the participants were subdivided into small team and prompted on supply chain-related issues. Key discussions points included:

Key Objectives Raised in Small Group Discussions

  1. There is a gap and opportunity to better align crop production with regional emerging climate trends (i.e. changing crop type in drought areas).
  2. Sustainable sourcing can be brought into conflict with lowest-cost sourcing down the supply chain, hence collaboration will be key to avoid adversarial situations.
  3. Progress made today toward defining and showing progress towards quantifiable goals can help lessen a push towards increased regulation. A failure will have the opposite effect.
  4. Rural infrastructure has been neglected in many areas and must be addressed to achieve more sustainable commercial output.
  5. Organizations risk ignoring the cost to growers and hence alienating a portion of them if global priorities completely trump local priorities.
  6. Education upstream to growers and downstream to consumers must be aligned but also sensitive enough to account for diverse markets and consumer segments.
  7. Sustainability must be economically sustainable.

Key Programmatic Issues Raised in Small Groups:

  1. Retailers need to be prepared for prolonged initiatives to help consumers comprehend the drivers and implications of sustainable sourcing. Related to this, consumer packaged goods companies must take the lead on defining appropriate labeling and definitions.
  2. Business to business and business to consumer education will remain greatly impaired until common sustainability metrics are established and support commercially. Similarly, the “impact” of sustainability programs must be of communicable, tangible and significant.
  3. Water is a commodity with no common market to manage it today. Addressing water use in a manner productive for growers will be critical given their disproportionate use.
  4. We must provide case studies and leadership so further ag land development reliably addresses ecological mitigation.
  5. Government incentives have often guided grower behavior, so now the challenge ts to make that happen with sustainable outcome.