Finance industry players are seemingly queuing up to help the Farming for the Future's research into how producers can preserve and optimise natural landscape capital on farms to lift their economic and environmental results.
Research by scientists, farm accountants and advisors on 130 grazing properties aims to build a library of information about how investing in natural capital strategies would help farmers make strategic decisions about natural capital investments as part of their business and personal goals.
The results will include details about the costs involved in making the most of natural capital and the likely timing of returns on investment.
The Australian Sustainable Financial Institute has just partnered with Farming for the Future's principal sponsor, the Macdoch Foundation, supporting case studies and pilot programs for climate and nature risk assessments, financial reporting and disclosure frameworks.
FftF will use evidence from the farms studied to develop indicators of natural capital and assess how strategic landscape management might boost farm productivity and earnings.
The sustainable finance institute (ASFI) formed in 2019 with the goal of realigning the financial services system so more investment money flowed to activities which promoted "a sustainable, resilient and inclusive Australia".
Chief executive officer, Kristy Graham, said the finance sector had a vested interest in avoiding the risks associated in not having the sort of productive natural environment which helped agriculture to prosper.
Institute members were already closely involved in agribusiness banking, insurance and providing financial capital to help farmers.
By working with Macdoch and its FftF researchers, producers could be supported as they evolved their farm businesses to be more resilient and profitable, and have financial partners, such as bankers, knowing how best to support them.
The partnership with FttF would also help the ASFI's own roadmap of recommendations for integrating data on natural capital resources such as soil quality, vegetation and waterways into the decision making processes of financial institutions, so there were tangible benefits for farmers.
Australia's biggest farm sector lender, the National Australia Bank, also recently partnered with FftF to support the 130-farm study, the largest of its kind undertaken across Australia.
The bank also wants to see farmers making more informed and strategic decisions about their natural capital investments.
NAB is participating alongside two of its agribusiness customers, who will receive a review of their farms' natural capital and how it influences the performance of their business.
FftF program director, Dr Sue Ogilvy, agreed the research should help producers, financiers and supply chains better understand the benefits of natural capital.
"Currently, information about returns on investment in natural capital is only available in studies of individual farm businesses or small-scale studies which are not representative of the industry more broadly," she said.
While the research currently focused on livestock holdings, the foundation would move into the cropping and mixed cropping sector in its next phase.
NAB's regional and agribusiness banking executive, Khan Horne felt the ground-breaking program would benefit the entire agricultural sector as farmers were empowered to quantify and report on their environmental resources and assess how to drive greater productivity and profitability.
"Farmers recognise that natural assets underpin production and profitability and the importance of protecting those resources through improved land management practices," he said.
"Increasingly, our customers are moving towards sustainable and climate-smart agriculture, and the thirst for knowledge about how to run the farm better is also growing."
Andrew Marshall
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
