The Business Advantage

Yesterday saw the last thematic event in the IFAD and CCAFS organised series “the Agriculture Advantage”. This session, the Business Advantage, focused on private sector climate actions.

Private sector-led climate actions are key to helping countries achieve goals set out in their Nationally Determined Contributions (NDCs).  But of all publicly available climate finance, only 2.5 per cent goes to agriculture.

 “Populations are increasing. Food insecurity is increasing,” said IFAD's Margarita Astralaga. "If we have a chance of achieving developing country NDCs, most of which mention agriculture, we need to mobilise more financing and this can only come from the private sector.”

H.E. Luis Felipe Arauz Cavallini, Costa Rica's Minister of Agriculture and Livestock said that in order to engage the private sector they need to see a tangible benefit.

"These benefits exist, we just need to get better at communicating them to potential partners," said Cavallini.

He then gave examples of successful engagement with the private sector in Costa Rica particularly focussing on coffee and livestock.

Then followed an interactive panel moderated by Tony Simons, Director General of the World Agroforestry Center (ICRAF).

“There is a common misconception that public good equals private bad, and vice versa. We need to undo and reframe this thinking,” said Simons.

Whilst acknowledging that there are serious risks within the agriculture sector and also when it comes to engaging with them, Simons said that the benefits were still greater, and a priority moving forward needs to be in de-risking agriculture, possibly through insurance schemes.

Margarita Astralaga then gave an in-depth review of IFAD’s flagship Adaptation for Smallholder Agriculture Programme (ASAP). In it she detailed how ASAP engages with private sector entities throughout its portfolio.

“At IFAD we don’t just work on Public-Private-Partnerships (PPP), we work on PPPP. For us the Producers are an integral part. We consider the smallholders we work with, and the cooperatives we empower them to join as private sector entities,” said Astralaga.

Fhumulani Mashau, Projects Officer, Southern African Confederation of Agricultural Unions (SACAU) gave an insight into her experience in Southern Africa. She talked of the important role Information and Communications Technology (ICT)will play going forward and how climate-proof infrastructure was a huge priority.

“The main role of the private sector is scale,” said Matthew Reddy, Director for CSA, World Business Council for Sustainable Development (WBCSD). “There is an opportunity to link agriculture to large companies. We can bring the whole value chain together. We can increase productivity and simultaneously decrease greenhouse gas emissions – which is important for everyone.”

Diane Holdorf, Chief Sustainability Officer, Kellogg Company talked of all the work Kellogg’s has been doing to improve its sustainability record, and how by 2050 the company wanted to be using 100 per cent renewable technology, a huge feat.

“We knew that we needed transformation. We needed the enabling policy and technology to allow us to do it,” said Holdorf. “Food waste and loss are huge risks. They are specifically mentioned in SDG 12. For our part, we noticed an area we could improve, and that is in food labelling. There is confusion around 'best before’ and 'use by' labelling. We are driving consistency in labelling to reduce confusion and eventually reduce food waste and loss. Another important area we are working on is packaging sizes.”

After a long Q&A session, Astralaga wrapped up by stating, “It is all about trust. Trust is key to engage agricultural value chains from farm to plate. We need to foster a trusting environment because private sector investment is essential!”