Extensive research has shown the environmental and economic benefits of conservation practices.
The Coalition is exploring banking and investment approaches that facilitate adoption of conservation practices, including:
- Data analytics and frameworks that link farm profitability, environmental performance, and banking metrics.
- Interest rate reduction programs, structured financing, guarantee funds, and other financial market products.
The Coalition is working with big data experts, economists, finance experts, and other technical partners to develop a scalable and cost-effective framework with accompanying metrics. This will support lending and appraisal practices by banks and over time can demonstrate the economic benefits of adopting certain conservation practices and investment strategies. The framework will help lenders and investors convert the environmental and economic benefits into relevant metrics (e.g., reduced cash flow risk, improvements in efficiency or asset value, or price premiums).
To make the framework actionable, the AGree Coalition will support a pilot project in a specific geography with commercial banks and other partners. The pilot project will apply the framework to a financial product for farmers and landowners who want to invest in conservation practices that increase profitability, enhance property values, and reduce producers’ long-term risk.
Through this data framework pilot project with commercial lenders, the Coalition will take the important step of demonstrating how conservation investments impact the bottom line and reduce risk.