Engaging Business for Integrated Landscape Initiatives in Africa

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Lee Gross of EcoAgriculture Partners introduces strategies for engaging business for integrated landscape initiatives in Africa.

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  • Good afternoon Ladies and Gentleman,

    I would first like to thank my session co-organizer Mr. Andre Brasser and Mrs. Laura Fox

    And the Landscapes for People, Food and Nature Initiative – Business Engagement Working Group – including members from CI, RA, WRI, AWF, Solidaridad, Root Capital, Sustainable Commodities Assistance Network, and many others…

    Who have contributed to the synthesis findings have over the past couple of years have contributed to advancing the thinking on business and landscape approaches.

    The objective of this presentation is to:

    offer you a quick overview to summarize our brief’s findings on business engagement in landscape approaches,
    offer some examples from the continent and
  • With approximately 60 percent of the world’s remaining arable land, Africa is poised to achieve significant economic growth through agricultural development and other rural land uses (AGRA, 2013).

    Smallholders represent the overwhelming majority of all farms in Africa and produce up to 90% of the food in some countries. But they need better connections to markets and more cooperation amongst each other.

    On average, about 65% of Africa’s labor force is employed in agriculture, yet the sector accounts for about 32% of GDP, reflecting relatively low productivity.

    Recently, agriculture has re-surfaced at the top of policy and development agendas across Africa with growing recognition of the potential to promote economic growth while contributing to increased food security, poverty reduction, and environmental conservation.

    Because of its contribution to the economy, the agriculture sector’s poor performance is one of the major barriers to development on the African continent. Some formidable challenges in Sub-Saharan Africa have contributed to erratic agricultural growth patterns. Several studies have noted that meeting the target of the Millennium Development Goals (MDGs) requires consistent and broad-based growth (with agriculture taking the lead), accompanied by dramatic improvements in infrastructure, governance, and other social indicators.

    Agriculture remains the key sector for food security, employment, and growth, despite diversified agroecological zones, production, and consumption patterns. Agriculture-led growth has the largest impact on reducing the depth and breadth of poverty (International Food Policy Research Institute [IFPRI], 2012), and focusing on staples is justified because food staples have strong growth linkages.

    Africa’s big development agenda is to achieve an agriculture sector annual growth rate of at least 6% and meet the time-bound targets set in the MDGs. This agenda will not be achieved if there is no rapid agricultural transformation through increased productivity, income growth, and competitiveness with good natural environment stewardship for sustainable development.

    ---------------------

    A recent report by the World Economic forum…

    The Africa Competitiveness Report 2013 is the result of collaboration among the World Economic Forum, the World Bank, the African Development Bank, and the Ministry of Foreign Affairs of Denmark.

    Says that….

    Between 2008 and 2020, consumer products, natural resources, agriculture, and infrastructure in Africa are projected to combine for a potential projected revenue of USD 2.6 trillion, or a sustained compound annual growth rate of four percent (WEF, 2013).
  • Businesses are increasingly at risk of “sustainability megaforces” – interconnected risks that will have unprecedented effects on business performance and profitability in the future

    These mega-forces include: climate change; competition for energy, land, water and material resources; population growth and migration; poverty and food insecurity; and ecosystem degradation. Food and beverage businesses will be directly and indirectly affected by a range of global trajectories


    Global agriculture must produce enough food to feed at least 9 billion people by 2050, with nearly all that additional food needed for developing countries and due to per capita increases in meat consumption.
    • By 2030, the global demand for freshwater is projected to exceed supply by 40%.
    • An overall shift to marginal and unconventional production, in the face of scarcity and conflicts over natural resources, is leading to lower productivity potential, particularly in areas of weak infrastructure, resulting in increased susceptibility to production shortfalls.
    • Climate change, resource depletion, and demographics have a strong impact on the availability and price of agricultural commodities.
    • The global middle class is predicted to grow 172% between 2010 and 2030, and while businesses will seek to serve this new middle class market, it will be at a time when resources are likely to be scarcer and more price-volatile.

    -------------------

    Based on our research findings, agribusinesses find water, climate, and community risks to be urgent, and best suited to piloting landscape approaches.

    Agribusinesses and food sector brand manufacturers are increasingly aware of sustainability risks. The interconnectedness of the water-food-energy-climate nexus is increasingly being recognized by business as requiring integrated solutions. In some cases, stability in key sourcing and operational regions may be at stake.


    To give an example, many companies are particularly concerned about water availability and recognize that it represents one of the biggest risks to staying in the market and prospering in the immediate future, as reported by the World Business Council for Sustainable Development — an organization of companies that galvanizes the global business community to create a sustainable future for business, society and the environment (http://go.nature.com/vtYscN).

    For an agriculture based economy that is completely dependent on its water resources for economic production, the social, economic, financial (investment), regulatory and reputational risks associated with a deteriorating bio-physical environment are significant. Given its linkages to the national economy and
    the international export markets, these risks are not localized within the basin but extend through to the rest of Kenya.
  • To date, the response of agricultural businesses and food industry to these concerns has largely focused on securing supplies and developing sustainable sourcing strategies for specific value chains. Examples include sectoral initiatives such as the African Cocoa Initiative (WCF, 2014) in Cameroon, Cote d’Ivoire, Ghana and Nigeria focused on increasing productivity and farmer income in cocoa, and investments in farmer certification schemes that incentivize good ecological and social management, such as Unilever’s certified tea investments in Kenya (Unilever, 2014).

    Many of these approaches promote changes at farm- or concession-scale and are not easily adapted to landscape-scale issues that can threaten long-term business success (e.g., cross-sectoral competition for water resources). A landscape approach to risk reduction and sustainable production is likely to be needed where risks operate at the scale of whole sourcing areas (Kissinger et al, 2013).

    Sustainability initiatives in the food and beverage sector have grown dramatically over the past two decades, yet much of this work has focused on improving the environmental and social performance of specific farms, forests, and post-harvest operations in corporate supply chains.

    Companies are becoming involved in certification systems, wetland banking, biodiversity banking, and other payments for ecosystem service (PES) schemes. Recent innovations and partnerships in agricultural commodity production (such as commodity roundtables and corporate supply chain commitments) pursue supply chain sustainability.

    However, markets provide inadequate tools for businesses to assess and respond to sustainability challenges.11 Certification has become a widely used tool for driving sustainable practices in the food and beverage industry. A valuable attribute of certification—traceability—is increasingly used to ensure transparency in sourcing high-risk inputs.12 However, certification requirements vary, and not all standards address the range of risks that companies face in their operations and in key sourcing areas.

    While these systems offer a critical means of providing companies with off-the-shelf standards, criteria, and performance metrics, they are often applied at farm- or concession-level scales, and are not designed to apply at the landscape scale, where problems may originate or need to be addressed.
  • The most frequently reported participants were local and district government in 86% of ILIs and producer associations in 83%. Private sector stakeholder groups were notably absent from most ILIs with agribusiness groups found in 8%, logging in 5% and mining in only 3% of ILIs.
    .
  • This report demonstrates that when profitability is threatened by a constellation of risks that cannot be mitigated solely on-farm or via supply chain programmes, landscape approaches offer solutions.

    Landscape approaches provide a framework to deliberately work in an integrated manner beyond the farm-scale to support food production, ecosystem conservation, and rural livelihoods across entire landscapes.
  • We propose the following business-oriented definition of a landscape approach:

    Identifying risks to the business beyond the farm- or facility-scale, and recognizing that long-term business success is tied to healthy communities and ecosystems. Thus, a landscape approach refers to activities in a socially or geographically defined area that:

    seek to improve food production, ecosystem services, and rural livelihoods;

    includes policy, planning, management or support activities at the landscape scale;

    involves inter-sectoral and/or multi-stakeholder coordination; and

    are participatory and support adaptive collaborative management.
  • Addressing the challenges of climate adaptation, water stewardship and building community relations all require “more than the sum of the parts” thinking.

    Landscape approaches are different from scaling up the efforts of individual interventions.

    It is about spatial thinking and targeted planning of interventions across an area with other stakeholders, rather than just working with more producers

  • Operationalizing business engagement requires shaping markets to achieve the multiple objectives of ILM.

    Businesses, working with landscape managers seeking to change the underlying financial incentives of stakeholders have many different types of instruments that they can promote or engage with.

    Though there are many ways to categorize these instruments, broadly speaking these fall into one or more categories; product markets such as eco-certifications or eco-tourism; ecosystem service payments such as payment for watershed services or conservation easements; and financing such as short-term credits, impact investments or subsidies.

    To date ILIs have utilized a combination of these market and financial mechanisms to support their objectives.
  • Businesses are traditionally innovators and are mostly concerned with finding practical solutions. They are increasingly stepping forward as key players to identify new sustainable strategies for the benefit of their own operations as well as society.

    To give an example, many companies are particularly concerned about water availability and recognize that it represents one of the biggest risks to staying in the market and prospering in the immediate future, as reported by the World Business Council for Sustainable Development — an organization of companies that galvanizes the global business community to create a sustainable future for business, society and the environment (http://go.nature.com/vtYscN).

    Lake Navaisha Initiative,Kenya (Kenya Government, WWF, Dutch Flower Industry, Community Groups)

    Water security risks – insufficient supply, climate change and
    population growth threaten operations

    Water Futures Partnership, South Africa (South African Breweries Ltd, SABMiller, WWF, GIZ)

    Water security risks– insufficient quality, unsustainable
    upstream practices and climate change threaten operations

    ---------------
  • British American Tobacco Biodiversity Partnership, Uganda (Tropical Biology Association, Nature Uganda, Tree Talk, BAT-Uganda, , CBOs and Fauna & Flora International,

    Production risks to long-term quantity and quality of supply
    – unsustainable land use practices and natural degradation in
    region
    • Biodiversity risk and opportunity assessment tool (BROA)
    identified the area as a high priority
    • Local communities and institutions to undertake
    landscape enhancement, restoration and protection
    activities across the demonstration areas using
    agricultural best practices
    Mechanisms – direct support for best practice and
    community development activities

    Olam International and Rainforest Alliance

    Integration of climate change and landscape management components into existing certification

    Risk of climate change impacts on cocoa production
    • Training farmers in the new SAN climate module
    • Creating linkages with forestry policies including REDD+
    Mechanisms – eco-certification, REDD+
  • Southern Agricultural Growth Corridor of Tanzania (SAGCOT) (More than 30 governments, institutions, organizations and private sector partners)

    Agricultural Green Growth Approach

    Risks to natural resource base and social cohesion –
    low productivity, unsustainable practices in region, soil
    degradation, poverty
    • Facilitate the development of clusters of profitable
    agricultural business
    • Capitalize on new opportunities to apply sustainable
    production, processing, and supply chain practices
    Mechanisms – Innovative financing strategies to support best
    Practices

    Rwanda Nyungwe (Gishwati) (Rwanda government and private sector actors including the British- South African New Forest Company, local community groups and int. ngos)

    Landscape Restoration and Green Growth

    Risks to local economy and natural resource base – Forest
    deforestation/degradation
    • Kick-start a forest industry, based on the harvesting
    of old pine-eucalyptus plantations, including wood
    processing chain linked to the government’s national
    electrification program
    • Replanting with better ecologically adapted eucalyptus
    varieties, plus indigenous/exotic species mix
    Mechanisms – payments for ecosystem services
  • There are a number of important actions that can encourage business to be more effectively engaged in ILM in Africa.

    Talk Business –

    • Why should business care? Is it about what
    business can contribute to livelihood and
    conservation agendas or is it about how
    these agendas can contribute to business
    success?
    • Share the risks and cut the costs: Can
    enabling stakeholders to see overlaps in
    investments spatially, spur joint-action and
    investment amounting to a greater collective
    impact? What is the pre-competitive space
    for this activity?
    • Build on existing market and financial
    mechanisms: Can we develop self-financing
    models for ILIs?

    Create Wiki Tools for Business

    Create Business Wiki Tools - Make ILI tools
    easily accessible for business at a low cost basis
    by creating in open source environment. Tools
    must fit easily with existing business operations.
    • Are current business risk assessment tools
    adequate to identify and qualify risks
    spatially?
    • Are current assessments accessible for small
    and medium enterprise?

    Create Business Capacity

    Set up the Business-as-Unusual School - Include
    ILI knowledge in existing business and agricultural
    curricula. Create new business oriented courses
    to increase business staff capacities to identify the
    possible benefits of ILIs and engage in complex
    multi-stakeholder approaches
    • Do companies have the appropriate capacity
    and knowledge to participate?
    • How can we build on existing momentum to
    increase awareness in Africa?
  • Activities in the Cross-Landscape Collaborative Learning
  • Engaging Business for Integrated Landscape Initiatives in Africa

    1. 1. Engaging Business for Integrated Landscape Initiatives in Africa Lee Gross, EcoAgriculture Partners
    2. 2. Between 2008-2020 – growth rate of 4%
    3. 3. New risks necessitate collective action Climate Change Poverty and Food Security Competition for resources Increasing demand Source: KPMG, 2012. Expect the Unexpected: Building business value in a changing world.
    4. 4. Address Risk at Scales
    5. 5. Low private sector participation in integrated landscape initiatives in Africa 0% 20% 40% 60% 80% 100% Industry Agribusiness Community Groups Education/Research NGOs Marginalized Groups Producer Groups Government % of surveyed initiatives Only 8% Source Milder, J.C., A.K. Hart, P. Dobie, J. Minai, C. Zaleski. 2013a. “Integrated landscape initiatives for African agriculture, development, and conservation: A region-wide assessment.” World Development, 54, 68-80.
    6. 6. "The landscape approach has been championed by organizations active in the development and conservation sectors for many years, though the concept has been slow to migrate into mainstream corporate thinking. - José Lopez, Executive Vice President, Operations, Nestlé S.A.
    7. 7. Reducing Risk through landscape approaches
    8. 8. Requires More than Sum of Parts Thinking More than sum of parts thinking
    9. 9. Landscape approach interventions and support mechanisms • Ecosystem service payments – watershed funds, conservation easements • Financing instruments – short-term credits, impact investments or subsidies • Secondary markets – non-timber forest products • Product markets – voluntary sustainability standards and certifications
    10. 10. Overview of current initiatives • Regional partnership mitigating a jointly identified risk – Lake Navaisha Initiative, Kenya – George, South Africa, Water Futures Partnership – Zambia, Community Markets for Conservation, COMACO
    11. 11. Overview of current initiatives • Sourcing Business or NGO led partnership mitigating regional risks – Uganda, British American Tobacco Biodiversity Partnership – Western Ghana, Juabeso- Bia landscape initiative
    12. 12. Overview of current initiatives • Policy Government or International fund led Initiatives – Southern Agricultural Growth Corridor of Tanzania (SAGCOT) – Rwanda Nyungwe (Gishwati) Landscape Restoration
    13. 13. Consensus Actions – how can the business sector be engaged in ILIs? • Talk Business – construct the business case – Create incentives and a stronger case for business at any scale to include ILI multiple objectives in running interventions. • Create Wiki Tools for Business – Use landscape risk and opportunity assessment tools to identify business risks and drive priority actions • Create business capacity – Set up the Business-as-Unusual School - Include ILI knowledge in existing business and agricultural curricula.
    14. 14. Let’s talk business and landscapes…what do you think?
    15. 15. Breakout action groups 1. Talk business – construct business case 2. Landscape risk and opportunity assessment tools 3. Create business capacity 4. Market and incentivize based mechanisms 5. Others? 6. Others?
    16. 16. ACTION PLAN • Short title • Objectives • WHY (Rationale, why action is needed): • Key/Illustrative Activities • WHO would be involved? With what roles? • WHAT is needed to make this happen? (endorsements, resources, involvement of other actors, et al • NEXT Steps to mobilize Action • CHAMPIONS to ensure Next Steps happen (people in Action Team and organization)
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