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22 Oct 2024
5 min read

Regenerative agriculture: But what do you mean?

Agriculture is one of humanity's oldest industries, but current practices significantly impact nature. In response, ‘regenerative agriculture’ has emerged as a potential solution. However, the lack of a clear, universally accepted definition has resulted in various descriptions being used, creating confusion, and adding difficulties in assessing risk. We believe there are benefits to agreeing a clear, measurable and outcomes-based definition.

Regen Agriculture

Why is the agricultural sector important to nature? 

Agriculture world's largest industry, employing around a billion people and generating over $1.3 trillion worth of food annually[1]. It has transition from the local to global, with intensification and expansion leading to increasing pressure on nature and climate. Indeed, agriculture is the largest contributor to exceeding planetary boundaries[2].

The current system is both highly dependent on nature and directly impacting nature. For example, it depends on nature for ecosystem services such as pollination (between $235 billion–US$577 billion worth of crops annual rely on pollinators[3]), rainwater, and natural pest control, and will be impacted by any disruption to these services. It is degrading nature through pesticide, fertiliser and chemical use and pollution; habitat loss and degradation; degradation of soil health; and extraction of freshwater. For example, it accounts for 70%[4] of global freshwater withdrawals, 80% of deforestation,[5] and 60% of global biodiversity loss,[6]  mainly due to land conversion. Land degradation has been estimated to cost between $6.3 trillion and $10.6 trillion annually[7].

Reforming current practices could have a positive impact on nature, the ecosystem services it provides to the sector, and our wider economies. The transition to regenerative agriculture offers a potential solution.

What is regenerative agriculture?

At its core, regenerative agriculture involves restorative farming practices aiming to rebuild and enhance ecosystems, focusing on improving soil health, improving livelihoods, and restoring nature. This approach often includes reducing chemical inputs, increasing crop diversity and integrating livestock in ways that promote ecological balance.

Despite its growing popularity, no clear, universally accepted definition exists for regenerative agriculture. This is largely down to different practices being appropriate in different contexts, thereby methods differing across geographies and sectors. In some contexts, regenerative agriculture will mean reducing pesticide use, while others may view it as a comprehensive approach to restoring ecosystems. Such differences complicate the evaluation of regenerative agriculture’s true impact and pose challenges for accountability.

Why do we need a definition?

Regenerative agriculture has attracted attention from a wide range of stakeholders, including multinational corporations, environmental organisations and government agencies. Many large food and agricultural companies now use the term, often explaining how they are incorporating regenerative practices into their supply chains and how these are helping them deliver on their climate and nature goals.

According to a recent survey[8] of 30 multinational companies, 24 referenced regenerative agriculture in their sustainability strategies. However, just 18 of those companies provided a clear definition of the term, and only eight of those had quantitative targets in place. Another survey, conducted by FAIRR, found that 32 of 50 agri-food companies they assessed do not put any formal quantitative targets against their regenerative agriculture practices, and only 8% have financial support mechanisms in place to support farmers[9].

Without a standard definition or clear guidelines, ‘regenerative agriculture’ risks becoming another buzzword, similar to ‘natural’ which has been diluted by vague or inconsistent use. So, a clear international definition could, in our view, be a positive for various stakeholders. For example, companies would have the ability to clearly demonstrate how they are supporting nature by adopting regenerative agriculture across their supply chain, while reducing any potential reputational or liability risk. Investors would be able to assess the credibility of companies' claims, identify specific risks and allocate capital appropriately. And policymakers would be able to easily align the tools they have to support greater adoption of regenerative agriculture and its outcomes that governments have committed to in the Paris and Montreal Agreements, for example reforming agricultural subsidies to support the transition.

How do we do this credibly?

It is a topic that has sparked global debate – unsurprising given the tension between the need for clarity and standardisation versus the importance of flexibility and local adaptation. So, if we are to get a definition that is comprehensive and credible, we believe we need to consider:

  • Complexity: regenerative agriculture is not a one-size-fits-all solution; practices that are effective in one geography or context may be unsuitable in another. Also, in order to qualify as ‘regenerative’, can there be single and simple practice like cover crops, or should it be multiple practices i.e. a comprehensive or holistic approach? This variability suggests a rigid definition could hinder adopting practices best suited to local conditions and simple approach could ‘tick the same box’ as a comprehensive approach
     
  • Innovation: As an evolving concept, farmers are experimenting with new techniques. A strict definition might therefore stifle their innovation
     
  • Smallholders: If companies must meet specific definitions, smaller farmers or those beginning their regenerative journey may face barriers to entry
     
  • Cultural: A definition might overlook that farming is not merely an economic activity; it is closely tied to local cultures, traditions, and community practices

Is the answer in outcomes?

Some suggest one way to integrate these considerations would be a focus on outcomes rather than processes in regenerative practices. Defining regenerative agriculture might overly emphasise specific practices instead of overall goals like improving soil health and restoring nature. An outcome-based approach – that is measurable - allows for flexibility in achieving these goals.

Efforts on using measurable ‘outcomes’ as a definition is already underway. Over the past few years there has been efforts to pull stakeholders together to foster alignment, for example the ‘Regen10’ initiative[10] and in the UK the British Standards Institute work is ongoing. The One Planet for Business and World Business Council for Sustainable Development (WBCSD) also identified five key outcomes[11] (see below) that could be included in a definition:

We believe by focusing on measurable outcome metrics, a common framework can be created that promotes transparency, accountability and investment in regenerative practices. We are engaging stakeholders in this ongoing discussion, as we believe this approach offers a solution to companies, consumers, investors, and policymakers, helping to ensure regenerative agriculture fulfils its promise of protecting and restoring nature. Regenerative agriculture will be a key topic discussed at the upcoming UN Biodiversity Conference (COP 16), and we look forward to developments in this conversation.

 
[1] https://www.worldwildlife.org/industries/sustainable-agriculture
[2] https://www.mckinsey.com/capabilities/sustainability/our-insights/nature-in-the-balance-what-companies-can-do-to-restore-natural-capital
[3] https://www.ipbes.net/article/press-release-pollinators-vital-our-food-supply-under-threat
[4] https://www.fao.org/land-water/water/water-management/en/
[5] https://www.worldwildlife.org/publications/living-planet-report-2020
[6] https://www.wwf.org.uk/food
[7] https://www.sciencedaily.com/releases/2015/09/150915090404.htm
[8] https://newclimate.org/sites/default/files/2024-09/Navigating%20regenerative%20agriculture%20in%20corporate%20climate%20strategies_sep2024.pdf
[9] https://www.fairr.org/news-events/press-releases/food-sector-making-more-promises-than-progress-on-regenerative-agriculture
[10] https://regen10.org/
[11] A Shared Vision for Regenerative Agriculture | WBCSD

Responsible investing Investment stewardship ESG
Alexander Burr

Alexander Burr

ESG Policy Lead

Alexander joined in 2019 and leads LGIM's ESG policy engagement across markets. Prior to this, he helped establish an impact fund that uses blended finance…

More about Alexander

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