Land Use & Agriculture ESG

Overview

Agriculture uses 50% of Earth's habitable land and is the leading cause of deforestation and biodiversity loss. Sustainable land use and agriculture practices are essential for feeding the world while protecting nature. ESG considerations are driving transformation in food and agriculture.

Land Use Challenges

Current State

• Agricultural land: ~5 billion hectares (38% of land)
• Deforestation: 80% from agricultural expansion
• Soil degradation: 33% of arable land affected
• Water use: 70% of freshwater withdrawals

Business Drivers

• Raw materials: Direct land use
• Supply chain: Agricultural commodities
• Sourcing: Forest-risk products
• Operations: Facility locations

Sustainable Agriculture Practices

Key Approaches

Regenerative Agriculture

Focus on soil health and ecosystem restoration:

• Cover cropping: Year-round plant cover
• Reduced tillage: Minimal soil disturbance
• Crop rotation: Diversity benefits
• Integrate livestock: Holistic management
• Composting: Organic matter enhancement

Conservation Agriculture

Minimizing environmental impact:

• Precision agriculture: Input optimization
• Integrated pest management: Reduced chemicals
• Water efficiency: Irrigation optimization
• Agroforestry: Trees + crops

Organic Farming

Synthetic input avoidance:

• No synthetic pesticides/herbicides
• No synthetic fertilizers
• Genetic engineering restrictions
• Animal welfare standards

ESG Considerations

Environmental

• GHG emissions: Agriculture ~25% of global
• Deforestation: Supply chain risks
• Water use: Scarcity risks
• Biodiversity: Habitat impacts
• Soil health: Long-term productivity

Social

• Labor practices: Farm worker conditions
• Land rights: Indigenous and community
• Food security: Access and affordability
• Animal welfare: Treatment of livestock
• Rural development: Community impacts

Governance

• Supply chain transparency: Traceability
• Certification: Standards compliance
• Reporting: Disclosure quality
• Risk management: ESG integration

Business Strategies

For Food Companies

1. Sustainable sourcing: Certified commodities
2. Supplier engagement: Capacity building
3. Product innovation: Regenerative products
4. Transparency: Labeling and disclosure
5. Investment: Agricultural transformation

For Agricultural Companies

1. Practice transition: Regenerative methods
2. Emission reduction: Climate-smart agriculture
3. Biodiversity: Habitat protection
4. Water stewardship: Efficiency
5. Continuous improvement: Measurement

For Investors

• Portfolio assessment: Agricultural exposure
• Engagement: Company dialogue
• Thematic investment: Sustainable agriculture
• Metrics: ESG data integration

Certifications and Standards

Practical Guidance

Steps for Companies

1. Map land use: Direct and supply chain
2. Assess impacts: Environmental and social
3. Set targets: Science-based for land
4. Engage suppliers: Capacity building
5. Verify: Third-party certification
6. Disclose: ESG reporting

Tools and Resources

• SBTN: Land targets
• Cool Farm Tool: Carbon calculator
• Field to Market: Sustainability metrics
• Regeneration International: Regenerative practices

Key Takeaways

• Agriculture is major driver of environmental issues
• Sustainable practices are increasingly required
• Regenerative agriculture gaining momentum
• ESG integration is accelerating
• Consumer and investor pressure growing
• Supply chain engagement essential
• Certification helps but transformation needed

References

• TNFD · SBTN · IPBES · CBD — nature and biodiversity frameworks