Financial leaders set ambitious sustainable food transition targets, as EU set to miss climate goals
27 Oct 2022 --- A coalition of food and finance institutions say that US$113 billion of currently existing assets will have to meet specific and time-bound targets in areas such as zero deforestation and carbon removal. The new initiative claims to offer “first-of-their-kind” credible targets for investment in a sustainable food system which are time-bound and specific.
The new initiative focuses on the converging food and climate crises and claims to do more than previously set goals to transform global food production systems into sustainable models.
Interestingly, its launch comes as a report by the Changing Market Foundation has found the EU will widely miss its 30% methane reduction target by 2030.
With an expected methane emissions reduction of 3.7%, the EU would have to multiply by eight its efforts toward methane reduction to comply with its target made under the Global Methane Pledge and the European Green Deal.
The Global Methane Pledge was launched in November 2021, with over 100 countries joining the effort.
Targeting methane reduction
According to the Changing Markets Foundation, livestock methane emissions are responsible for up to 32% of them globally, and cutting them in the agriculture sector by 45% by 2030 might translate into avoiding 0.3˚C warming by 2040.
While accounting for 32% globally, livestock farming is responsible for 53% of European methane emissions.
While accounting for 32% globally, livestock farming is responsible for 53% of European methane emissions.“The European livestock sector also contributes significantly to other health and environmental impacts, including 80% of soil acidification and air pollution (with emissions of ammonia and nitrous oxide) and 73% of water pollution,” explains the foundation.
To reach the 2030 target, the organization proposes to revise the Industrial Emissions Directive to limit pollution from the biggest emitters, the 7.5% of the largest farms, which have 60% of the EU livestock.
According to its estimates, the current proposal currently debated by the European Commission would allow 2 to 4% additional methane reduction per year.
Methane has 82.5-times more warming potential than CO2 over a 20-year period. This led New Zealand, earlier this year, to create a “burp tax” to curb livestock methane emissions.
Supersized ambitions
Meanwhile, the UN-supported group urges the wider finance sector to ‘supersize its ambition’.
The new network - which includes global financial institutions from across the world, including Rabobank (NL), Nuveen Capital (US), FIRA (Mexico) and Signature Agri Investments (Netherlands - but focus in Africa) - calls on governments to closely monitor what can be done to transform food systems and keep funding credible green initiatives.
“Identifying what a state-of-the-art, credible target to finance sustainable food and agriculture looks like is a vital part of addressing the urgent climate and food crises,” says Wiebe Draijer, co-chair of the Good Food Finance Network and former CEO from Rabobank.
“Increasing financial flows to the sustainable food transition must be at the top of the COP27 agenda if leaders are to leave Egypt with a viable plan for achieving a Net Zero world,” he continues.
“From digital tools to zero deforestation, this new generation of high-ambition targets can enable a cleaner and greener food and agriculture sector,” adds Eric Usher, Head of UNEP Finance Initiative.
List of targets
The new initiative focuses on the converging food and climate crises and set goals to transform global food production systems into sustainable models.
Some of the most important targets set by the network include:
Rabobank’s initiative to support millions of smallholder farmers to transition to agroforestry – growing trees instead of the use of crops or livestock. The bank is also working on expanding remote sensing techniques to measure carbon sequestration and its monitoring.
By 2030, the program aims to take from the atmosphere 150 megatons of CO2 per year – the equivalent of 40 coal-fired power stations’ annual emissions.
“Simultaneously, Rabobank will provide financial support to those who are struggling as climate change impacts the productivity of land and labor, helping to ensure a just transition to a more sustainable food system,” says Berry Marrtin, member of Rabobank's executive board.
Meanwhile, The Trust Funds for Agricultural Development in Mexico will grow its US$350 million climate and resilience portfolio by 5% per year.
More to target deforestation, Nuveen Natural Capital in the US will upgrade its deforestation policies in its 1.2 million hectares in assets, and Signature Agri Investments in the Netherlands – with holdings across Africa – will go beyond committing to zero deforestation targets and work to establish regenerative farming principles and climate-resilient restoration of degraded lands in Africa.
The Global Environment Facility will restore 420,000 hectares of degraded land and improve land management practices in 20 million more hectares, which will mitigate 223 million tons of CO2. All while using 21 million fewer tons of chemicals.
Moreover, Yara in Norway will apply digital solutions that help with nutrient efficiency, pollution reduction and water saving in 150 million hectares of farmland by 2025.
By Gaynor Selby and Marc Cervera
