Supported by the MAVA Foundation, Clarmondial published a report on financing the transition to regenerative agriculture in the European Union.
The report is available here.
This report reviews the need for additional financing to support the transition to regenerative agriculture in the European Union (EU). Covering two-fifths of Europe’s land area, agriculture is both at risk from and a major contributor to environmental challenges. Regenerative agriculture seeks to enhance productivity and environmental management by applying context-specific practices based on biological principles. Regenerative agriculture practices can contribute to a variety of public and private sector objectives, including on climate, biodiversity, soil, and water. Building on a review of the status of regenerative agriculture and the financing currently available to the agriculture sector, the report identifies a financing gap in the hundreds of billions of Euros annually, and approaches and mechanisms to address this gap. It concludes with recommendations to key stakeholders.
Successful transition to regenerative agriculture in the EU requires cross-sectoral collaboration to produce relevant proof of concepts, test new financing structures, and to develop clear and predictable value chain and policy support. During this period of rapid change – both environmental and socio-economic – it will be critical to mobilize additional private sector support, from investors, credit providers, and companies, to overcome counterpart and business-model challenges. The public sector, i.e., the EU and Member States, have an important role in creating an enabling environment that supports emerging investment counterparties and business models. Similarly, companies in the agriculture sector can incentivize farmers to adopt regenerative practices and help attract additional funding to landscapes and value chains. As highlighted in this report, Results Based Financing (RBF), including carbon finance, and other innovative financing mechanisms should be explored to accelerate the transition to regenerative agriculture. Achieving this will require cross-sector collaboration and additional investments in data collection.