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“Investors Are Now Screening Business For A Social Purpose”

May 25, 2018 |

This article was originally published on Farm Online

“Investors are now screening business for a social purpose and their interest in sustainability goes further where agriculture is concerned. Environmental economist James Bentley, from National Australia Bank, used that fact as one of many arguments for Australia’s beef industry to move towards scientific and collaborative measurement to allow it to communicate responsible management.

At a sustainable food chains seminar held as part of Beef Australia in Rockhampton, hosted by Agforce, Mr Bentley reported investors were starting to ask more and more questions around climate risk, water scarcity and environmental degradation.

“We know that to grow Australian agriculture we need to grow investment,” he said. “So if your business is pitching for investment capital, think about how you might communicate you’re a responsible manager, your environmental risk is well-managed and  the last ten year’s profit were not the result of overgrazing such that future returns might be compromised.”

Mr Bentley outlined the concept of natural capital – the stock of ecosystems and the services like clean water and healthy soils they provide. In stark contrast to the traditional approach of economists who take natural capital to be intangible and unknown, pioneering thinking in the banking sector is placing strong value on farming ecosystem management.

“Natural assets are indeed assets and need to be managed and invested in with the same due diligence and care we afford our other capital assets,” Mr Bentley said. In surveys involving more than 10,000 NAB customers, 91 per cent of producers said soil health was a key business risk and 70pc listed the climate…”

Read on at: Farm Online.

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