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Private funding and nature-friendly farming: What it means for you

United Kingdom
Policy & Views
Agriculture Transition Plan
policy
Green finance
regenerative farming
Private funding
Solar panel field on farm

Our CEO, Martin Lines, recently shared his thoughts on the surge of large-scale private funding for nature-friendly farming. This guide explores what this shift could mean for farmers committed to sustainable practices as the sector transitions to more environmentally friendly ways of working.


Why are private businesses funding farms?

Agriculture, like many other industries, is being urged to enhance its environmental practices. As part of their environmental, social and governance (ESG) responsibilities, businesses are now required to address Scope 3 emissions, which include the environmental impact of their entire supply chains. At the same time, they aim to meet international biodiversity targets and rules concerning the loss of nature and habitat due to their activities.

For farmers, this means supply chains and large retailers are increasingly keen to tackle the emissions from global production systems. They are now more accountable than ever for the ESG impact of food production. For example, instead of relying on imported soya or maize grown on the other side of the globe to feed their livestock, there’s a growing interest in a supply chain that supports pasture-fed animals with locally sourced diets.

Waitrose recently made headlines by announcing its commitment to shifting its entire supply chain to regenerative farming practices by 2035, but it is far from the only business in the food sector working on such moves.


Who else is getting involved?

Farms can deliver an array of environmental benefits that attract private-sector support. Insurance companies, for instance, are investing in flood management schemes on farmland to protect communities downstream and reduce costly payouts. 

Water companies are realising that paying farmers to reduce agricultural run-off is a more effective way to tackle pollution than building new infrastructure such as sewage plants.

Farms can also sequester carbon, which is increasingly attracting financial support from a wide range of companies looking to lower their carbon footprints.

There is also scope for effective partnerships with energy businesses. Solar panels can be installed on farmland while still allowing livestock to graze, doubling the farmer’s income streams. Similarly, the recent repeal of the onshore wind farm ban opens up new opportunities for farmers in renewable energy. 

Farmers should not have to navigate different criteria, tests and data collection requirements for each company they supply

Sounds great - but what are the challenges?

Despite the promising opportunities, these developments are unfolding in a largely unregulated market. Businesses are keen to meet their legally binding environmental targets and are pushing forward with long-term plans. At the same time, political shifts have seen rollbacks of environmental goals, complicating the situation. 

This is particularly problematic given the need for standardisation across key topics such as carbon sequestration and biodiversity gain. Farmers should not have to navigate different criteria, tests and data collection requirements for each company they supply. A patchwork of measurement tools and standards, all providing different results, could potentially deter farmers from engaging with these new income streams.

There also needs to be coordinated thinking to ensure that efforts to reduce emissions don’t inadvertently encourage unsustainable farming practices. For instance, reducing methane emissions by slaughtering animals earlier can lead to increased use of bought-in feed and housing livestock in sheds to accelerate weight gain.

Farmers who are slow to adapt or who continue to believe that climate change concerns don’t apply to them could find themselves losing market access

Are we ready for this?

A major concern is how unprepared many farmers are for the shift toward nature-friendly farming. After decades of being encouraged to feed the nation and maximise yields, this requires a significant change in mindset and practices. 

Farmers are now being asked to view their land as a business asset, with the role of the farmer recast as manager. This shift requires farmers to consider not just productivity, but also environmental sustainability and financial viability. Farmers will need to explore how to stack enterprises, diversify income streams and maximise the potential of their land.

Farmers who are slow to adapt or who continue to believe that climate change concerns don’t apply to them could find themselves losing market access as supply chains pivot towards regenerative farming systems. We must bring farmers along on this journey as the world around them changes dramatically.

Farmers hold the key to delivering for nature, the environment and the climate while also ensuring food security

What support is needed?

We urgently need to provide expert advice at scale, so farmers have access to someone who can help them understand what their land can offer and how to manage it effectively. There also needs to be much greater awareness of the available funding. Currently, too much of this support is fragmented and only accessible to those who are already well informed.

Time is running out. If farmers are not given the right information and support to make changes soon, targets around nature’s recovery and emissions reductions by 2030 will be almost impossible to achieve. We must be realistic about the challenges and take bold action to get us back on track.

Farmers hold the key to delivering for nature, the environment and the climate while also ensuring food security. We need to keep farmers on their land, supporting their local communities and economies. As agriculture changes, our priority must be to ensure that farmers continue farming, contributing to a future where both nature and agriculture can thrive.