Certified supply chains and impact investment

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Millions of smallholder farmers need to access climate-smart agricultural practices if they are to adapt to a changing climate. This makes mechanisms for scaling up as crucial as the practices themselves. Photo: N.Palmer (CIAT)
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Project description

One of the key challenges facing climate smart agriculture (CSA) is scale. There are many studies of CSA practices that are effective locally, but which lack the mechanisms to allow ready replication in other contexts. As such, these pilot projects remain limited in scope, unable to reach the millions of smallholders that need to adopt CSA practices if they are to remain viable in the face of a changing climate.

To confront this challenge, this project evaluates potential pathways to mainstream CSA practices in the cocoa and coffee sector and achieve adoption at scale. The project assesses the exposure of coffee and cocoa systems to climate change at a sub-national scale, develop appropriate CSA practices with farmers - including the incorporation of cash and food crops to increase the resilience of these systems, and codify these practices in adaptation guidelines.

The project tests new methods for scaling up CSA practices through: voluntary certification schemes and impact investments in producer organizations. It uses smallholder coffee and cocoa systems in Ghana, Nicaragua and Peru as model cases.

The short-term objectives of this work are to:

  • Explore how to best incorporate CSA practices into ‘climate-smart certification’ and ‘climate-smart investment’ approaches, in a manner that is scalable and commercially viable. 
  • Evaluate the utility of certification and impact investing as CSA scaling mechanisms, document their capacity to nudge other cocoa and coffee value chain actors towards improved practices and estimate the costs of scaling this approach versus not adapting or adapting in the wrong way.
  • Evaluate adaptation costs for farmers and producer organizations, and explore how to engage diverse commercial and public actors for adaptation investments under different levels of climate change severity.

​Research activities

  1. Identification of site & crop specific CSA practices by exposure gradient: including identification of relevant climate drivers based on exposure gradient which will feed into participatory processes with producer associations.
  2. Methods and approaches to incorporate specific CSA practices (by crop and gradient) into Rainforest Alliance's voluntary certification training: Engagement with peer agencies to replicate this process and influence uptake of methods and approaches by additional farmer associations and public extension services.
  3. Exposure gradient mapping of coffee, cocoa and food crops; site and crop specific CSA identified: Modelling climate change impact on coffee, cocoa and food crops; and establishment of an exposure gradient (from low to medium to high changes in suitability). Identification of site specific CSA practices and packages identified and potential assessed through ex-ante and trade-off analysis.
  4. Design, incorporation and scaling of innovative climate-smart financial products into Root Capital's tailored financial products and investment vehicles: Design and standardization of underwriting guidelines for long-term renovation and related adaptation investments; Training of loan officers to identify CSA best practices and incorporate learning into credit decisions and consultations with clients; engage with peer institutions in the Council for Smallholder Agriculture Finance to replicate and scale financial products for climate adaptation and mitigation.
  5. Multi-stakeholder engagement for scaling adoption of practices, learning and scope of impact: mapping of the ecosystem of engagement necessary at national and global levels to support implementation of CSA practices, at farm and landscape level and utilize various engagement processes to share project learnings early and often to maximize uptake or results, reach and impact.

This project helps to mainstream CSA practices in coffee and cocoa value chains by:

  • Developing locally adapted guides for tree and food crops and incorporating these into the training and technical assistance that is delivered to tens of thousands of farmers in the target countries through certification networks; and,
  • Contributing to the design of new impact investment mechanisms to support CSA and chain resilience.

Outcomes

Farmers are preparing for climate change through crop diversification, management adjustments, and the incorporation of locally adapted food crops, depending on their specific exposure to climate change and crops. These practices are being promoted by voluntary certification agencies through their extension networks and incorporated into financial investment vehicles by impact investors and others in the finance sector. These processes are supported by multi-stakeholder round tables with key private, public and civil society actors and lessons learned documented and promoted for other crops and regions.

Blogs related

Partners

Through these partnerships the project is sharing lessons learnt with peer organizations in voluntary certification, impact investing and wider sustainable agriculture communities (specifically key private sector partners) in a pre-competitive fashion to drive wider adoption in these key communities and beyond.  

Further information

For further information, please contact the project leader, Mark Lundy (CIAT) at m.lundy@cgiar.org.