£5.7trn investor coalition urges G20 leaders to reform food system subsidies for climate
Members of the FAIRR coalition of investors are calling on G20 leaders to reform agricultural subsidies– lest they risk undermining global efforts to tackle the climate and nature crisis.
The coalition comprises more than 30 major investors internationally. Collectively, members manage almost £6trn of assets.
It has made a call to action to those attending next month’s G20 summit in India, urging reforms of agricultural policy in line with the nations’ commitments as signatories to the Paris climate agreement and to the UN biodiversity treaty ratified last year.
Under the biodiversity treaty, nations have committed to ending subsidies that damage nature by 2030. There has been much discussion on reforming energy sector subsidies away from fossil fuels already, but less on the changes needed for payments to farmers.
FAIRR is highlighting that the UN estimates that 87% of the $540bn provided annually to agricultural producers are likely harming nature and/or distorting the price of products that harm human health.
Agriculture, forestry and land use accounts for some 24% of annual global emissions. The bulk of these emissions are attributable to livestock.
FAIRR would like to see pre-COP28 discussions in India covering the need to reform financial support to agriculture and land-use in line with G20 countries’ national and international climate and nature commitments.
The investor coalition believes this will necessitate a phase-out of subsidies for red meat and dairy, with finance redirected to support workers and to fund lower-impact alternative proteins.
A new study out this month revealed that the US and EU paid £35bn of subsidies to meat and dairy farmers between 2014 and 2020, compared with just £33m of public spending on plant-based alternatives.
As a result, meat and dairy are kept artificially cheap, and R&D funding remains easier to secure for animal agriculture than for cultivated meat or plant-based protein.
The COP28 host, the UAE, is calling on nations to update their Paris Agreement pledges to include food systems and has already done so itself.
Ahead of the summit in Dubai this winter, the UN Food and Agriculture Organization will provide a roadmap to alignment with the Paris Agreement’s 1.5C trajectory for food systems.
This roadmap has resulted from previous lobbying from FAIRR.
Laimonas Noreika, co-founder and chief executive of HeavyFinance, said it is “vital” that major investors and other bodies continue to advocate for strong green policy on agriculture ahead of COP28.
Commenting on FAIRR’s new call to action, Noreika said: “
This unified effort demonstrates a powerful commitment to tackling global challenges through financial influence. As the urgency of climate change and environmental degradation continues to mount, initiatives like these are instrumental in driving much-needed change.”
FAIRR’s policy director Helena Wright added that it is important for wealthier nations to lead by example, as they will have the capability to financially support the agriculture transition across the world.
© Faversham House Ltd 2023 edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.