Regenerative Agriculture for Ecosystem Services

Koen van Seijen

20 years: Food and agriculture

In this video, Koen van Seijen discusses the concept of payment for ecosystem services and its significance for farmers transitioning to regenerative agriculture. He explores how incentivising farmers for their ecological contributions can alleviate financial strain and promote sustainable practices. He finally outlines the importance of recognising nature's value, the pathways to implementing these payments and the investment opportunities that arise from this approach.

Agriculture

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Regenerative Agriculture for Ecosystem Services

7 mins 6 secs

Key learning objectives:

Understand the importance of payment for ecosystem services
Understand how we can implement payments for ecosystem services
Identify investment opportunities that can support payment for ecosystem services

Overview:

What if farmers could receive compensation not just for food production, but for their role in nurturing ecosystems? Currently, nature is undervalued, leading to practices that harm the environment. We need to shift our economic systems to reflect the true worth of ecosystem services to ensure farmers are adequately paid for all the services they provide, which is a lot more than just producing food. Koen van Seijen examines the need for payment models that reward farmers for these ecological contributions, highlighting innovative examples and the investments necessary to facilitate this change.

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Summary

Why are payments for ecosystem services essential in today's world?

The current extractive system often undervalues nature, making it cheaper to pollute than to protect. This situation leads to an economic model where standing trees or healthy ecosystems hold less value than timber or short-term profits. By recognising the ecological contributions of farmers, we can begin to shift this paradigm. For instance, research by Ralph Chami highlights how a single African forest elephant provides significant carbon capture, emphasising the potential value of ecosystem services in monetary terms.

How can we implement payments for ecosystem services?

The goal is to put real cash into the pockets of farmers who wish to adopt regenerative practices now, rather than in the distant future. Innovative businesses are already paving the way. For example, soil carbon credit marketplaces allow farmers to earn income while improving soil health. Initiatives like Sekem in Egypt use carbon credits to subsidise farmers' transitions to biodynamic practices without increasing consumer prices, demonstrating how such models can work effectively.

What investment opportunities exist within this framework?

Big food companies must recognise the importance of working with suppliers to achieve emission reduction targets. By investing in ecosystem service payments, companies can reap several benefits, including:

1.Return of inspiration: Empowering farmers with additional financial support.

2. Social return - Reducing consumer blame for low food prices.

3. Natural return - Increasing demand for sustainably produced food, leading to healthier soils.

4. Financial return - Potential cost savings when sourcing ingredients and creating new markets.

However, valuing ecosystem services can be complex. For example, pricing pristine rainforest based on timber value risks incentivising deforestation. The challenge lies in understanding that while monetary value can aid conservation efforts, it often fails to capture the intrinsic worth of nature.

What is the ultimate takeaway on payments for ecosystem services?

Although the concept is gaining traction in regenerative agriculture, it is crucial to ensure that these payments reflect the full scope of farmers' contributions—not just food production but also ecosystem health. By reevaluating how we account for externalities, we can create a sustainable model that benefits both farmers and the environment.

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Koen van Seijen

Koen van Seijen is a regenerative agriculture and food expert, has been exploring the carbon sequestration potential of regenerative farming since 2011. He is the founder and host of the Investing in Regenerative Agriculture and Food podcast. In the last decade through 300 podcast interviews with investors, fund managers, scientists, entrepreneurs and farmers, Koen explored the role of money and entrepreneurship all over the world in regenerating soils, ecosystems and communities. Koen also works at Toniic, a global community of asset owners seeking deeper positive net impact across the capital spectrum. Toniic members consist of around 500 high net wealth individuals, family offices, and foundations, who are deepening their impact in over 25 countries.

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