By Lynda Kiernan
It’s true that the world is collectively being faced with unprecedented ecological, environmental, and societal challenges. Climate change, pollution levels, soil degradation, species extinction and loss of pollinators, drought and overexploitation of water resources, as well as economic inequality, are threatening not just specific regions, but due to globalization, the world as a whole.
As our timeline for addressing these issues grows ever shorter, calls for action from the public and stakeholders alike are growing louder. It took a decade or more, but impact investing – a term originated by the Rockefeller Foundation in 2007 to reflect an investment mission that aims to result in positive, measurable benefits for the environment and society while also generating healthy financial returns – has gained traction. As of the close of 2018, global impact investments totaled $502 billion, according to the Global Impact Investors Network (GIIN) – up from just $35.5 billion in AUM only three years before. Likewise, Morningstar data indicated that last year, new investments in ESG-focused mutual and exchange-traded funds totaled $20.6 billion, up from $5.5 billion the year before, reflecting growth of 400 percent.
Key to impact investing, however, is the ability to standardize measurement, to quantify the impacts generated through these efforts, and verification. Toward this goal, HNRG has been working for two years with a consortium of stakeholders across the agricultural value chain – companies that farm, own, and/or manage farmland, along with two environmental groups – to launch Leading Harvest, an independent non-profit organization to oversee and maintain a new performance-based, industry-wide Farmland Management Standard and third party verification program.
As a fully integrated investment and property manager, HNRG president and CEO BIll Peressini noted that “good stewardship is good business”. Reflecting this mission, HNRG’s five SRI (Sustainability and Responsible Investing) pillars are: Climate Sustainability, Ecosystem Resilience, Watershed Protection, People Empowerment, and Community Prosperity. These five goals are woven through HNRG’s investment process, property management, and corporate operations, and also woven throughout the group’s newly released second annual SRI report, the 2019 Report on Sustainability and Responsible Investing.
Building upon its inaugural report issued in 2018, HNRG’s 2019 report reflects how the group has accelerated its fundamental SRI efforts through enrolled eligible properties with Leading Harvest. It also breaks down and reports the measures taken and quantified results generated from its actions taken across its five SRI pillars.
Climate Stability: HNRG outlined multiple steps being taken, including selling more than 1.2 million carbon credits from its New Zealand forests; improving soil health through regenerative farming practices such as cover cropping and no-till, or low-till farming; adhering to a strict zero-tolerance for deforestation; integrating renewable energy and energy efficiency into its operations; and accounting for carbon emissions across its properties (which are a net carbon sink), as well as from its office energy and air travel requirements.
Ecosystem Resilience: HNRG’s 5.8 million acres of managed forests across North America, Australia, New Zealand, and Chile are third-party certified sustainable, as is 100,000 acres of its managed farmland, with the goal of bringing the entirety of its farmland holdings into being 100 percent certified as sustainable. HNRG also is protecting and preserving wetland ecosystems that are crucial to biodiversity across its cranberry operations in Wisconsin; is protecting shoreline regions and migratory bird habitats; and is protecting pollinator habitats by planting 95 acres of pollinator habitat across its California almond orchards and by rotating crop species.
Watershed Protection: Through strict water and land management policies HNRG has protected nearly 12,000 miles of stream frontage, improving water quality and flow through its managed land, with every managed farm having a water management plan in place. In California, HNRG has built recharge basins that enable floodwater to be redirected into aquifers, and water consumption is tracked down to the millimeter.
People Empowerment: Beyond safety, HNRG strives for employee engagement, with 906 total employees, of which 28 percent are female. Extensive training totaling 8,500 hours has been tracked along with development opportunities provided toward building diverse and inclusive teams.
Community Prosperity: In 2019 HNRG contributed more than $512,000 to non-profits, including matching $49,000 in employee contributions to charitable organizations. In the field, HNRG maintains local vendor lists and contracts where possible, and locally sources its farm labor; hosts workshops and community days; engages indigenous peoples; protects historically and geologically sensitive sites; and volunteers with groups ensuring access to healthy food and strengthening community health.
To more deeply explore the results of HNRG’s integration of sustainability and impact measures across its forestry and agriculture portfolios, and how the benefits of these actions are quantified, showing yearly growth, please access the full report here.
– Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.
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