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ESG and the cost of capital

By November 29, 2019December 14th, 2021No Comments

1. Alignment and inclusiveness

The interrelated nature of the transformation required can make it appear complex and daunting, often paralysing action when we need it most. There is still significant debate about how such a transition is best addressed, whether among the different groups representing the various interests in food systems or in different geographic contexts. The forthcoming summit provides a time-bound opportunity to bring about a shared understanding of what is meant by food systems transformation – acknowledging that there is not one distinct food system but many that need to work in alignment towards a common set of outcomes.

A tangible outcome of a UN Food Systems Summit could be the identification and development of a set of science-based and economic pathways in support of country-led food systems transformation. This will help decision-makers, in their own local context and respective silos, to work together through the necessary and often challenging trade-offs and opportunities that arise from the food, water and energy nexus, including climate change impacts, biodiversity loss and diet-related health costs to name but a few.

Ensuring that people are central to shaping the transformation agenda is crucial. In preparation for the Food Systems Summit, processes such as the Food Systems Dialogues will allow for this through constructive dialogue (even debate) about options for change. If managed appropriately, this process of inclusion and alignment could have a profound and positive influence on the future direction of food systems.

Creating a North Star moment for the Summit, a moment which encapsulates the essence of the event’s meaning and ambitions, as witnessed at the recent UN Climate Summit, could stimulate a much wider movement for change. Motivating as many stakeholders as possible to take action and support a new vision for how and what food arrives on our plate, and how to shift these patterns in such a way that still enhances inclusive economic growth and opportunity for those directly involved in food and agriculture value chains, could be game-changing.

2. Innovation with a purpose

Recent and potential scientific and technological innovations, as well as the strengthening of traditional crops and farming knowledge and practices, collectively present a major opportunity to hasten food systems transformation – one particularly under-used in developing regions. The leadership challenges are, therefore, to build innovation systems that support the development and scaling of appropriate technologies, to ensure these are equitably implemented, to help build trust in food systems transformation, to align towards common objectives and to support collaboration across silos.

Closely linked to the innovation agenda is the need to significantly scale the ambition of agricultural and nutrition research facilities and alliances. Both national institutes and global institutions, working in a spirit of public-private cooperation are required to adapt rapidly to the fast-moving transition taking place within food systems. It is hoped that such a summit can act as a point in time when a renewed vision and support for a modernized research agenda in support of food system transformation can be fully articulated.

3. Incentives for change

To unleash the full potential of transformed food systems, a significant shift in the status quo is required to create the right incentives for adopting more appropriate practices and address the very real trade-offs that exist.

Food system actors often face real and perceived costs that prevent proven solutions from being profitable or being adopted. They face too many barriers related to misaligned incentives. These can often be categorized into four buckets: financial challenges, attitudes, lack of knowledge and system challenges. Shifting incentives in such a way that enables effective food system transition will play a critical role in addressing the costs incurred in overcoming barriers to adoption and scaling. These may include market-based incentives, blended finance mechanisms, public fiscal incentives, grant capital and non-financial incentives.

4. The importance of a platform for action-based approach

The above suggests that a UN Food Systems Summit in 2021 cannot just deliver commitments, but must present actions that can be monitored and reported against the 2030 SDGs. The complexity of food systems speaks to the insufficiency of current international approaches. Given the complicated multi-country and multi-issue overlaps involving health, food, land use, rural economic development, migration, conflict and investment, this is not surprising. While there is an increasing number of successful partnerships and alliances evolving to address geography-specific, as well as consumer and producer-specific issues, the so-far piecemeal progress must rapidly become a global effort that encompasses all food systems.


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