Tokens boost sustainable financing for the agri-food industry in the face of climate change.

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Tokens boost sustainable financing for the agri-food industry in the face of climate change.

The choice of whether to eat organic or non-organic, meat or plant-based products, short distribution channels or products from further afield. What impact will these choices have on health, biodiversity and climate change, and vice versa?

Agriculture and the agri-food industries, essential and high-performance sectors of the French economy, are at the heart of today’s major social and environmental challenges. They have a major responsibility in terms of managing the natural resources and living heritage that constitute their raw materials.

The recently published IPCC report shows the limits of the current development model (agricultural and industrial), in social, ecological and economic terms. Humanity’s carbon footprint has increased by over 190% in the last 50 years.

The agri-food sector, which is essential to the population’s primary needs, finds itself at the heart of a major dilemma: how can we continue to feed 8 billion people on earth, when climate change calls for an effort to reduce the planet’s greenhouse gas emissions, for which the agri-food sector is one of the main contributors?

What does the future hold for the food industry?

The challenge of tomorrow’s agri-food sector is to feed more than 8 billion human beings, in quantity and quality, in a sustainable way.

The agri-food sector represents a broad ecosystem organized into sectors ranging from producers (the agricultural world), upstream, to processors (industrialists) and distributors, downstream. The agri-food sector naturally exerts pressure on nature through its production and processing methods. It has a significant economic weight at national level. The market value of goods produced by agriculture is estimated at 75.5 billion euros in 2020. On a European scale, the food industry represents sales of 1.2 trillion euros.

The consequences of the weather have had an impact on the French sector’s balance sheet. On the farmers’ side, much of their production has disappeared, the inevitable consequence of a highly changeable climate (in 2020: early frosts, heavy rains during the summer and drought in the south); on the industrial side, an induced deterioration in product quantity and quality has led to a drop in competitiveness and export volumes worldwide this year. A situation that is unlikely to improve in the face of the many rapid climatic changes we are experiencing.

Supporting the move towards more environmentally-friendly processes and new models for our agricultural and industrial sectors is essential. We need to help our industries and producers to include sustainable, living production that respects the earth, people and animals, while fulfilling our mission to feed people in France and abroad.

What solutions can be implemented?

Giving preference to the regions and to diversified, reasoned agriculture, as well as to regional products and producers, is one of the solutions envisaged. For example, agri-food players supply traditional products and give preference to those that are regional and rare. Multi-year contractual purchasing commitments should be signed between local authorities and farmers, as well as between regional producers and manufacturers (and/or distributors).

In addition, it is important to emphasize that all measures in favor of short transport distances contribute to the protection of biodiversity and the reduction of carbon footprints. Every link in the production chain makes a significant contribution to reducing its impact.

Each stakeholder is involved in information and communication. It participates in the development of the latest knowledge on agri-food production and biodiversity. They incorporate this knowledge into company policies and activities. Using its influence and various means of communication, it informs stakeholders (business partners, suppliers, trade associations, consumers, etc.). Communication raises general awareness of the need to preserve biodiversity.

Finally, technology facilitates the implementation of solutions. In particular, Blockchain technologies enable the use and transmission of inalienable information that can be retrieved using certified measurement solutions (GBS, BFFI, Greenly, Cap’2er).

The tokenization of financial securities brings sophisticated financing solutions (rates indexed to sustainable impact, etc.) to smaller businesses. VSEs and SMEs that take action to protect the climate can make this known and benefit from financing with a bonus/malus based on the efficiency of their action.

In addition, certain national and European support measures simplify and encourage the ecological and digital transition in corporate financing programs
. These mutual approaches enable us to move more quickly towards a framework that respects biodiversity by implementing sustainable development practices in all our businesses.

Why and how can we contribute to the evolution of these sectors?

While the success of the climate transition depends in part on changes to our agricultural and food production systems, these are also the sectors that are already suffering the most from the consequences of climate drift. The agricultural world is forced to transform its practices to become more resilient in the face of a new climate, while at the same time contributing to the collective effort to mitigate global warming.

For companies, every action taken that has a positive impact can be used as a powerful communication tool. Today, highlighting actions in favor of biodiversity and demonstrating transparency with regard to the impact of products and activities is a way of demonstrating commitment to social and environmental responsibility (SER).

Every company has a role to play in CSR. Although corporate social responsibility has been developed as a voluntary approach, France now subjects companies to a legislative and regulatory framework that notably takes into account the environmental pillar of corporate social responsibility.

It’s clear that the gap between food supply and demand calls for major investments. Constraints in terms of resources and ecological responsibility (quantity vs. quality) can lead to opportunities for innovation and investment, in particular by turning to new agricultural, production and financing technologies that improve productivity while respecting the planet.

It is imperative to support and encourage agri-food businesses in their development by offering them financing solutions, in particular participatory financing, which enables the entire ecosystem to engage in joint actions. The scope of investment in this field is thus open-ended (capital goods, new-generation fertilizers and pesticides, genomics applied to crops and finished products, food processing, maintenance, packaging, etc.). The agri-food sector is in a constant state of innovation.

As a result, building a quality portfolio is closely linked to this sector. From a risk management point of view, supporting these companies is therefore logically the right decision to make.

Re fundia offers financing solutions to enable companies to participate in developments through the tokenization of ESG or green bonds. Re fundia’s solutions reduce the risk of illiquidity and make green investments in small businesses transparent. These solutions facilitate :

– access to inter-company financing for project promoters ;
– the contribution of ecosystems to the carbon neutrality of their environment by participating directly in project financing;
– the emergence of a secondary market for unlisted digital debt securities.

Re fundia offers an innovative framework for financing companies in the agri-food sector. By tokenizing financial securities, Re fundia reduces the number



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