Impact Investing for Sustainable Agriculture: Spatial Analysis of Potential Socio-Economic and Environmental Impacts

Authors: Solen Le Clec'h, ETH Zürich - Agricultural Economics and Policy , Samuel Ledermann*, George Washington University - Elliott School of International Affairs, Adrian Müller, ETH Zürich - Institute for Environmental Decisions; Research Institute of Organic Agriculture FiBL
Topics: Development, Agricultural Geography, Sustainability Science
Keywords: SDG, impact, sustainable investing, agriculture, development, spatial analysis
Session Type: Paper
Day: 4/5/2019
Start / End Time: 9:55 AM / 11:35 AM
Room: Capitol Room, Omni, East
Presentation File: No File Uploaded

Impact investment capital is seen as an essential part for achieving a transformation towards sustainable agriculture aligned with the United Nations’ Sustainable Development Goals (SDGs). The objective of this paper is to highlight novel insights into the developmental potential for this rapidly growing segment of private sector investments. We compiled a unique global dataset on publicly available impact investment deals and analyzed the trends in the type of investment, their location and their potential impact by considering the (mis)matches between their location and the socio-economic and ecological characteristics of the region. We find that impact investments are currently biased towards capital-intensive investments that target commercial smallholder farmers in value chains. From a global perspective, these investments hence fail to reach the majority of smallholder farmers and are limited in their ability to contribute towards a transformation in sustainable agriculture. Drawing on insights from development practitioners and impact investors, our results ultimately not only provide an important check on impact investments’ potential, but could furthermore help to target future investments based on spatially-explicit ecological and socio-economic criteria.

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