How This Group Hopes To Change Hawaii’s Agricultural Landscape

by Esha Chhabra

“Hawaii’s food system is broken,” says Constanze Niedermaier of Common Ground, a new platform to find regeneratively grown Hawaiian foods.

The islands export 80% of their crop, and import 90% of their food products, despite being a fertile land which has the potential to grow an abundance of its own needs.

John Parziale has been a farmer in Kauai for over 20 years, growing crops like ginger and turmeric. He’s seen the farming challenges first-hand: an emphasis on monocropping, high land costs that prevent young (and new) farmers from getting into the profession, and the emphasis on exports instead of self-sufficiency.

That’s why Niedermaier, Parziale, and others have come together, backed by a group of like-minded eco-forward investors, to create a hub for local food entrepreneurs: The Common Ground is a physical space in Kauai that serves as a base for a new food community focused on regenerative agriculture on the islands. With an accelerator and an incubator, Common Ground wants to support small and medium size food businesses who are trying to deviate from the conventional model of agriculture.

They include enterprises such as Maui Nui, which makes a venison jerky bar with wild-caught Axis deer, which have become an invasive species in Hawaii, explains Niedermaier, and yet are a nutritional meat. There’s Vintage Vinegars which produces a raw pineapple vinegar made from excess fruit and otherwise waste, at a pineapple processing unit (one of Hawaii’s most popular exports). Or ulu-based products that have provided an alternative to traditional grains and wheat-centric pastas; ulu, or breadfruit, is grown widely in the tropics and plays a pivotal role in agroforestry on the islands, says Parziale.

While the physical space set on an 83-acre agricultural campus once home to Kilauea Sugar Plantation and Guava Kai Plantation will serve as a meeting place for these entrepreneurs, allowing them to convene, share, ideas, and cross-collaborate, Common Ground has also launched an online marketplace to reach consumers beyond the islands. “We want people across America to discover these stories and products,” he says.

For Parziale who is a passionate advocate for a healthier food system and now operates a 5-acre farm which serves as a model and testing ground for those looking to convert to permaculture or regenerative practices, this is a heart-felt mission. “Agriculture has become one of the most destructive human activities on earth. Either we change, and model our agricultural systems after ecosystems, or regenerative agriculture is going to sprout from the ashes of our civilization.”

Agroforestry plays a huge role in this transformation for Hawaii. Unlike mainland farms that can rely on vast open spaces to have rows of planted crops, in Hawaii, its tree fruits, such as breadfruit, nuts, coffee, cacao, and more, can help produce a more regenerative system, Parziale says. The trees not only help keep carbon in the soils, but provide shade, help retain water, and allow for intercropping.

The last two decades, he says, have seen a massive consolidation in how we produce and consume food. “That has to change. Those destructive and extractive agricultural products have to be reckoned with.”

Common Ground’s campus will open in 2022. But till then, the online marketplace is available for consumers around the U.S. to discover some of these new innovative food companies, and get a taste of the islands, through a regenerative lens.

Why Capturing Renewable Natural Gas Has Legs in the Climate Conversation

RealClear Energy
By Mike Butler

When many people think of renewable energy, they think of modern wind, solar and hydropower resources. When they think of natural gas, they think of it as a traditional, finite source of energy – something that’s used and then gone.

But there’s another form of renewable energy that many have overlooked as an option to help meet some states’ emission reduction goals in regulatory actions like New Jersey’s Energy Master Plan and the Garden State’s larger climate conversation. It’s called Renewable Natural Gas or RNG inside the energy world.

RNG combines the strength and benefits of two forms of energy – renewable energy and natural gas – and it turns out it’s been around for as long as humans have been farming. Some might even refer to it as biogas, a byproduct of organic materials mixing with oxygen. RNG in this case comes from multiple sources of organic leftovers and waste.

Methane is the key molecule that makes up natural gas and found in the prolific energy basins across the country that we use to produce, transport and sell energy. Natural gas has many benefits, too. It’s clean, affordable and plentiful here in the U.S. Gas is able to be safely transported in pipelines and is used every day in our homes, businesses, transportation systems and power grid.

But traditional exploration for natural gas isn’t the only way to capture and harness methane – a chemical compound that occurs abundantly in nature does as well.

Besides being found underwater, in wetlands, and from naturally occurring seeps, methane is also released in landfills, water treatment plants, and in agriculture. The same methane that comes from oil and gas production also comes from four-legged creatures that dot the plains and fields of America’s farms and ranches – cows. There are an estimated 95 million cows in America and the small amounts of methane they release can really add up, and if uncaptured, that methane escapes into the atmosphere anyway where it has a significant impact on emissions.

If we effectively collect that waste, and process it, it can become a usable fuel that fits our existing infrastructure for power and home heating needs. And because this resource can be produced over and over, it makes for a great renewable source of energy from our livestock that also reduces harmful air emissions.

While the renewable gas utility market in Canada appears to have a more mature market, the U.S. is catching up quickly with California, New York, Colorado, Oregon and Hawaii all making strides to help utilities incorporate RNG into their energy mix.

For example, promising projects from agribusiness companies like Smithfield Foods will result in enough renewable natural gas to power more than 2,700 homes and business and brings the company closer to its goal of reducing greenhouse gas (GHG) emissions 25 percent by 2025.

The traditional natural gas industry is also committed to capturing more methane – after all, that’s the primary fuel source they are trying to sell, and every molecule going into the atmosphere is a dollar lost. Since 2000, the industry has invested more than $108 billion in technologies to help capture these “fugitive emissions” which can escape during production and operations.

That money is in addition to the $151 billion the federal government has invested in research and development programs primarily run though the Department of Energy and Argonne National Labs. On top of that, satellites, airplanes and helicopter sensor technology are all helping to detect and reduce methane from entering our atmosphere.

While RNG only makes a small percentage of our energy make-up today, the opportunities are tremendous and should be a part of the clean energy future New Jersey is pursuing. The more solutions we have to meet both our energy needs and environmental goals the better. Plus, consider the significant benefits that will be achieved by removing waste from our agriculture operations and the benefits for rural America. Over time our best minds will continue to advance and refine technology to help costs come down for RNG – just look at the cost of solar panels 10 years ago to today.

So while it may be early, the idea of capturing renewable natural gas definitely has legs for New Jersey’s energy future energy solutions.

The State Does A Lot To Help Farmers In Hawaii. But It’s Not Enough

By Jessica Terrell –

Farmers need better technology, data and transportation subsidies if Hawaii’s agricultural industry is going to grow substantially in the coming decades.

When Max Bowman graduated from college in 2008, he struggled to find a job that would let him move back home to the Big Island. It was the midst of the Great Recession, affordable housing was scarce, and there weren’t many openings that made use of his English degree.

So Bowman decided to do something unusual for his generation of workers in Hawaii: He partnered with his brother and started a farm.

Hawaii GrownBowman got a lot of help from the state in getting ‘Ano‘ano Farms up and running.

The brothers started planting leafy greens on a five-acre plot of state land leased through the Hamakua Ag Cooperative. They got a loan from the Hawaii Department of Agriculture to help with equipment and operating costs. The DOA came through with a second loan seven years later, when Bowman and his brother moved their operation to a much larger plot on the other side of the island.

“The story of our farm has a lot of connection to HDOA,” Bowman said.

Farmers and agriculture advocates say the state does a lot to keep farming alive in Hawaii — from battling pests to training farmers, researching new crops that can be brought to market, and providing loans when banks might not be willing to.

But there’s so much more that needs to be done.

Agriculture makes up less than 1% of the state’s economy. The real value of what Hawaii farms produce has plunged a whopping 72.9% since 1980, according to economists at the University of Hawaii.

It’s going to take a lot more farmers like Bowman — and big investments in new technology, infrastructure, cheaper interisland transportation, better data gathering and more — to reduce the amount of food Hawaii imports and make agriculture a significant contributor to the state economy once again.

And even though Bowman could be viewed as a success story for what young farmers can accomplish with a little help, the future of ‘Ano‘ano Farms is anything but certain. Rising shipping costs and restaurant closures during the pandemic have hit Bowman’s operation hard.

“There are just a number of challenges that are specific to agriculture in Hawaii that we face every day,” Bowman said.

How The State Helps

Hawaii is not an easy place to make a living farming.

Land is hard to come by. So is water. There’s a lot of fallow farmland from Hawaii’s defunct sugar and pineapple plantations, but much of it lacks critical infrastructure that farmers need to grow new crops. Housing for farm workers is in short supply. Transportation is expensive and there are a number of challenges with getting products to market.

And then there are pests. Hawaii’s climate makes it the perfect breeding ground for a number of insects that can decimate crops.

The state tries to lend a hand with many of these challenges.

The bulk of day-to-day state support for farmers in Hawaii comes through the Department of Agriculture and the University of Hawaii’s College of Tropical Agriculture and Human Resources.

The agriculture department plays an important role in regulating food production in Hawaii, but it also does a lot of marketing for farmers and ranchers, says Brian Miyamoto, executive director of the Hawaii Farm Bureau.

A lot of the DOA’s energy, though, is spent battling threats to crops. The department budgeted nearly $16 million last year on mitigating pests like the coffee borer beetle.

The department also gave out about $4.6 million in loans to farmers in 2020. The DOA’s lending program can be a lifeline to farmers who have been rejected by at least two banks, says DOA Chair Phyllis Shimabukuro-Geiser.

The University of Hawaii’s CTAHR works closely with the DOA on research, which is often funded by state or federal agencies through the DOA.

Some of that research is focused on short-term problems — new pests, helping farmers with struggling crops — but the university also plays an important role in providing long-term support for agricultural industries, says Nicholas Comerford, dean of CTAHR.

Take coffee — one of the state’s most successful agricultural industries. The university hasn’t been able to completely reverse the decline of coffee in Hawaii — production peaked in the 1950s — but it has helped keep the industry viable through decades of sustained research, Comerford says. It helped facilitate a statewide coffee growers association, assisted with mechanical planting and harvesting, conducted research into new coffee varieties and pest mitigation.

University employees known as extension agents act as a bridge between researchers and farmers. They can help farmers figure out new crops to grow, work to resolve challenges with soil or pests and figure out why some crops aren’t thriving.

But farmers say they see fewer extension agents out in the field these days. And CTAHR is facing steep budget cuts. The department lost 60 positions — 20% of its staff — this year.

“The pandemic has provided a difficult situation for us,” Comerford said.

But Comerford says the cuts are also an opportunity for CTAHR to figure out how to best allocate its resources and reexamine what it is doing to support agriculture.

Comerford and his staff are working with a consultant on a 10-year plan for the program. What do farmers need moving forward and how will CTAHR help with that?

“I think we’re at a stage where growth is really possible, where it hasn’t been possible before,” Comerford said.

Doing Better Moving Forward

The state needs to take a hard look at all its efforts to help farmers and bolster agriculture, says University of Hawaii economist Sumner La Croix.

And La Croix isn’t just talking about the Agribusiness Development Corp. — though he has few positive words for that state agency, which was created in 1994 to help the industry find a path forward during the collapse of Big Sugar.

The agricultural sector as a whole is becoming smaller, which doesn’t speak well for the efforts to grow it.

One big challenge, La Croix said, is that there isn’t much data about what crops are being grown in Hawaii. The agricultural department used to keep much more robust statistics, but much of that work was dismantled during the Great Recession.

“We might as well be dismantling the automatic pilot on a Tesla as we drive down the highway,” La Croix said. “I mean, we don’t really know where we’re going.”

The agriculture department isn’t going to be able to resume the level of market analysis and data gathering that it conducted a decade ago, says DOA Chair Shimabukuro-Geiser.

But the agency did make some new hires last year and has been collaborating with the USDA National Agricultural Statistics Service to get more data.

Last year, it was able to analyze the production value of the coffee industry and some other specialty crops so those farmers could qualify for a federal coronavirus assistance program.

But farmers say they need more information. About what is being grown in Hawaii. About what people are charging for those crops.

“You know, we set these goals like double food production,” says Miyamoto of the Hawaii Farm Bureau, referencing Gov. David Ige’s call for the state to double local food production by 2030. “That’s great because it gives us something to reach for. But as for the double … double from what?”

There’s a lot of room for the state to provide more services to farmers, La Croix said.

But that needs to start with the state taking a hard look at where and how the agricultural industry can expand — and then helping in a more strategic manner.

The state could be useful in addressing challenges with water access and general agricultural infrastructure, La Croix said.

It could probably also do more to promote crops, identify new crops and provide assistance to small farmers, La Croix said.

And farmers need help getting access to better technology, Comerford said.

Hawaii’s farms can make better use of limited land with controlled environments like shade houses — a structure to help protect plants from excessive heat or light. They need support using nanotechnology to control diseases. And they could use better access to the kinds of equipment that farms in Japan use on smaller plots of land. Federal environmental regulations make it difficult to import Japanese equipment, something the state could help with by providing money to bring in sample equipment to be tested by regulators.

Lawmakers gave CTAHR $2 million last year for a pilot project to see what the university could do to increase production in agriculture, Comerford said. So CTAHR put out a call for proposals to farmers across the state. It got more than 40 responses from farmers with suggestions for farm-specific obstacles that, if addressed, could help increase production.

“What it tells you is that there are obstacles to agricultural production in this state that can be taken care of with a small investment,” Comerford said.

Before you go

University of Hawaii breaks ground on food entrepreneurship facility

Pacific Business News
By Janis L. Magin

The University of Hawaii Community Colleges broke ground this week and plans to start construction in July on the Wahiawa Product Development Center in Central Oahu.

The $12 million project will turn a metal warehouse at 100 California Ave. into a value-added product development center where students from Leeward Community College can learn entrepreneurship skills while developing value-added food products.

Students will be able to develop products such as baked goods, pickled products, ice creams and juices, which will help local farmers utilize off-grade produce as ingredients, minimizing food waste.

“The Wahiawa Product Development Center will be instrumental in supporting the diversification of our local economy by adding value to Hawaii’s agricultural and food sector industries,” UH Community Colleges Vice President Erika Lacro said in a statement. “It will take the knowledge, creativity, innovation and uniqueness Hawaii offers to the next level, creating a robust workforce pipeline and providing the tools and skills for local farmers and entrepreneurs to take their value-added food products to market and beyond. Bringing this to the heart of Oahu achieves a critical milestone for our state in food security and sustainability.”

The state Department of Agriculture’s Agribusiness Development Corp. bought the property from Tamura’s in November 2013 for $4.29 million, and UH launched plans for the center in late 2019 with the publication of a draft environmental assessment. Ushijima Architects is designing the project.

“Products that are made-in-Hawaii are highly desired worldwide and we have a huge opportunity with the WPDC to capitalize on that global demand. Value-added entrepreneurship is critical for economic recovery as we look to strengthen the agricultural industry and diversify our economy to be less reliant on tourism,” state Sen. Donovan Dela Cruz said in a statement. “Wahiawa welcomes this community investment and looks forward to working with the University of Hawaii in the years to come.”

The Biggest Ideas in Farming Today Are Also the Oldest

Bloomberg Opinion
By Amanda Little –

Georgia cattle raiser Will Harris left behind the destructive techniques of modern agriculture, charting a new path forward for the livestock industry.

Earth’s soil can sequester vast amounts of carbon — I’ve known this for years. But it wasn’t until I stood at the boundary between two farms in southern Georgia recently that I appreciated the enormous potential of that fact.

Will Harris, a fourth-generation cattleman, reached down and scooped up a handful of pale reddish-brown soil from his neighbor’s peanut fields: “Dead,” he pronounced it, “a lifeless mineral medium.” Then he walked a few paces and dug up another handful — inky black and unctuous — from his own land. “A thriving organic medium, teeming with life,” he said. “It’s 5% organic matter compared to 0.5%, side by side.”

In one palm Harris held the legacy of our industrial farming past, and in the other, evidence of how to do farming right in a climate-stressed world. For every 1% increase in organic matter, an acre of soil locks away about 10 more tons of carbon. The dark pigment in soil is, in fact, carbon — and generally speaking, the darker the soil, the more carbon it contains.

All told, the world’s farmland may be able to sequester as much CO2 as the total amount emitted from the transportation sector, or nearly as much as the global electricity industry. To achieve that level in the U.S. would require significant reforms of industrial farming practices in crop and meat production — changes that would be costly to farmers at first, even as they bring long-term riches such as healthier land and animals. To encourage the transition, the Biden administration, Congress and the agriculture industry must support reforms with tax credits and other financial incentives.

Harris and his Georgia farm, White Oak Pastures, illustrate the path forward, along with all the challenges of redefining modern agriculture. At 66 he tends the land his great grandfather bought in 1866, and that was worked industrially for decades before Harris became a convert to more ecologically sound practices, known today as regenerative farming. The story of his conversion reveals the painful reckoning that comes with facing up to the destructive techniques now ingrained in modern farming, and the need to consider gains in broader prosperity that surpass the simple terms of immediate profit and loss.

Harris’s livestock pastures are teeming with native perennial grasses and cover crops — rye, radish, crimson clover and white clover — that excel at pulling carbon dioxide from the atmosphere, down through their roots and into the soil where the carbon feeds microbial life. As cattle graze and chew off the tops of the vegetation, they aerate the soil with their hooves and fertilize it with their manure, causing more plants and grasses to grow and pumping more carbon into the soil.

White Oak Pastures

Spanning 3,000 acres, White Oak Pastures is a fascinating blend of the wisdom of the past and technology of the future. Harris’ 2,000 sheep graze among a 1,425-acre field of solar panels. He uses drones, cameras, software and 150 miles of state-of-the-art modular fencing to rotate about 3,000 cows daily through 30-acre paddocks. Harris also practices a conservation technique called silvopasture, integrating animals, forage and forestland; he plants thousands of live oaks, pecan and fruit trees in his pastures to provide shade for his animals and lock down more carbon.

According to a soil survey conducted by the sustainability consulting firm Quantis in 2019, White Oak Pastures sequesters roughly the equivalent of 3.5 pounds of carbon dioxide for every pound of grass-fed beef it produces. I spoke with other scientists who think that number would be lower after accounting for all the sheep, pigs, and chickens Harris raises and the feed those animals consume. But many, including a team of scientists from Michigan State University that’s done extensive research on White Oak Pastures, agree that Harris’s cattle operation is net carbon-negative and represents a consummate example of regenerative livestock production.

Harris grew up in Bluffton, Georgia, a town of 100 people in the poorest county in one of the poorest states in the union. For most of his life he helped his father run the farm, then devoted exclusively to cattle. Together they adopted all the latest industrial practices with a singular focus on extracting every cent of profit possible from their herd. “We went to bed thinking about how many animals we could kill the next day,” Harris recalls. “The more the better.”

In those days, like most other industrialized livestock operations, Harris aggressively applied fertilizer and pesticides to his fields, and used antibiotics and hormone implants in his animals to maximize weight gain and fertility. If the recommendation was 2ccs of hormone, he injected 4ccs. “I was a heavy-handed, linear, more-is-better guy,” says Harris — a sensibility that pretty well defines industrial agriculture.

Harris’s conversion began soon after his father died in 2004, when he became the sole decision-maker for the farm. One pivotal moment came when he rode along in a double-decker truck hauling some of his 500-pound calves to be fattened and slaughtered in Nebraska. “The animals upstairs urinated and defecated on the ones on the bottom during a 30-hour drive,” he said. “That didn’t sit right with me.” It also bothered him that after grazing his pastures for months, the calves grew to adulthood in a concrete feedlot while being fattened entirely on corn feed — all calories and no nutrition.

Freed from his father’s strictly profit-driven approach, Harris tapped into his college education in animal husbandry and agriculture science to find alternatives that honored the deep connection he felt to the farmland and his animals. His first big change: he abandoned feedlots and took out a $7 million loan to build his own slaughterhouse so that he could ensure his animals were raised and processed humanely.

A Traumatic Transformation

He soon found that after pulling on one thread, the whole system he’d built with his father started unraveling. After Harris stopped feeding corn and grain to his cattle, he had to expand his pasture lands so that they could be exclusively grass-fed. He eliminated the antibiotics and hormones, and then found himself becoming irked by the financial and environmental costs of the gross overapplication of herbicides and fertilizers on his fields.

Economically, the transformation was traumatic. Harris had taken an enormous risk by making so many changes in succession. For the first time, the family farm was not only in debt, but operating in the red. White Oak Pastures wasn’t able to produce nearly as much beef as it had previously. Without hormones to accelerate growth, it took two years to raise a cow to a weight of 1,100 pounds, while an industrial animal reaches 1,400 pounds at 16 months. His pig litters shrunk: industrially raised sows typically have 14 piglets in a litter; he was lucky to get seven. And his slaughter costs surged: an industrial plant would charge $100 per cow, while it cost Harris five times that.

There was an agonizing period — more than a year — when he thought he would lose everything. But slowly, all the pieces in his new system began to work together. To compensate for his higher costs he raised his prices, charging 30% more for his grass-fed beef than conventional product, and 40% more for his pork.

White Oak Pastures currently hovers at the edge of profitability after years of painful losses. Separate from the financial calculation, the benefits of regenerative farming have been profound. Vastly improved soil fertility, which continues to increase over time, has made for healthier and more abundant pastures and crops. By integrating crop and animal production — long decoupled by industrial agriculture — he’s restored the natural nitrogen cycle in which animal waste, rather than synthetic fertilizers, nourish fields.

Harris has tripled his landholdings, buying up depleted industrial farms that border his own and converting the land from pale, almost un-arable dirt to carbon-rich soils. His methods have significantly increased soil moisture, in turn counteracting topsoil erosion and building resilience to heat and drought in his grasses and crops. In the last 16 years, Harris has eliminated the use of thousands of tons of agrochemicals, ceasing fertilizer runoff, reducing algea blooms in local waterways and stopping the evaporation of fertilizer into the air, which forms nitrous oxide, a greenhouse gas many times more potent than CO2.

Regenerative farming is much more labor intensive than conventional agriculture, which Harris counts as a good thing after watching his farming community suffer huge job losses over the decades from industrialization. At the height of its own profitability in the 1990s, White Oak Pastures needed four employees to raise 1,000 head of cattle each year. Now Harris raises 3,000 cows with 190 employees — nearly double the total population of his town. And he’s created a model of local, vertically integrated production that isn’t vulnerable to the kind of supply-chain disruption that plagued the centralized meat industry during the pandemic.

A More Dignified Life

Harris has also restored the presence of native plants on his land and introduced more than a dozen cover crops that invite and sustain a diversity of bird and insect life. As much as any environmental goal, he’s committed to “freeing animals from the stresses and indignities of industrial operations.” He creates conditions in which his animals can express instinctive behaviors: cows can roam and graze, hogs can root and wallow, chickens can scratch and peck — which for them, fundamentally, is a state of contentment.

In my visits to dozens of cattle farms and slaughterhouses all over the world, I’ve found none more attuned to animal wellness or humane slaughter than White Oak Pastures.

Still, Harris struggles to remain profitable, and his story underscores the need for federal incentives to help farms like White Oak Pastures thrive. His cattle operation can’t yet receive compensation for sequestering carbon — even though private sector players such as Indigo Agriculture Inc. and Nori are paying farmers to do just that. Measuring carbon on livestock farms is far more complex than on farms that grow commodity crops, and carbon-market firms say they won’t be registering livestock operations until measurement technologies and protocols become more precise and widely accepted.

That needs to happen swiftly; the U.S. Department of Agriculture must fund non-profit research organizations like Comet Farm that are working to improve and expand measurement protocols. The Biden administration can also put money toward a farmer tax credit based on one designed for oil producers and power plants in 2017 to encourage the use of direct-air carbon-capture technologies. Soil, after all, is the mother of all direct-air capture.

But the biggest immediate threat to small farmers like White Oak Pastures is the lack of regulation over labeling agricultural products as organic or grass-fed. Loose definitions of those terms allow major industrial producers to claim the label and charge far lower prices than regenerative farmers, even while raising their cattle overseas on corn feed. That forces farmers like Will Harris to lower their prices to compete, squeezing their razor-thin margins even further. Biden’s USDA has the power to rein in this damaging trend with stricter definitions and enforcement.

In the meantime, it’s essential to educate consumers, who are increasingly opting for plant-based proteins from brands like Beyond Meat and Impossible Foods, about the climate benefits of regenerative livestock farming. Harris looks at it this way: if a person avoids meat because they don’t want to eat a once-living animal, he respects that. Or if they just don’t like the taste, “I get it,” he said. “But if they tell me that they’re opposed to eating meat because it’s inhumane or destroys the earth, they can kiss my ass.”

Perhaps the most valuable lesson the public and private sector can learn from White Oak Pastures is that the answer to food security and climate-smart agriculture isn’t technology alone, but technology combined with the wisdom of ecology. Technology in cooperation — not competition — with the natural world. “Nature is so much smarter than we are,” Harris said. “We think we can figure out anything, except we can’t. Nature bats last.”

Case study casts doubt over ESG claims of Canadian pension fund PSP’s major agriculture investment on Maui

Case study casts doubt over ESG claims of Canadian pension fund PSP’s major agriculture investment on Maui, calls for greater scrutiny into the community impact of investments

Responsible Markets today published a case study of an approximately $600 million investment that the $135.59 billion Public Sector Pension Investment Board (PSP) is making in a former sugar plantation in Maui, Hawai’i. The report found evidence that the Montreal, Canada based pension plan, which invests its capital through PSP Investments, is not living up to its own environmental, social responsibility, and corporate governance (ESG) principles, resulting in adverse impacts on Maui’s environment and residents.

The study entitled “From the Mountains to the Sea: When Big Money Moved in on Maui’s Agriculture” takes a comprehensive look at Mahi Pono LLC, capitalized by PSP. Mahi Pono was created in December of 2018 under management of Pomona Farming, a subsidiary of the California based private equity firm Trinitas Partners. It now owns and operates over 41,000 acres of farmland in Maui’s central plains, which it acquired from long-time plantation owner Alexander & Baldwin.

Among Responsible Markets’ findings is that the success of the Mahi Pono investment is dependent on securing water rights at exceptionally low rates, at a direct economic and cultural cost to the indigenous Hawaiian people, and on the continued diversion of water away from East Maui, a practice that undermines Hawaiian farming communities. Rather than creating local food security as the company has promised, the Mahi Pono business plan is dependent on export crops. Additionally, the company operates secretively and with little transparency, and has failed to generate the number of jobs promised.

“Through Mahi Pono, PSP is seeking to profit by exploiting the resources of the Hawaiian people,” said Shay Chan Hodges, a co-organizer of Responsible Markets’ initiative, the Maui ESG Project, and co-author of the report. “This is not an ESG investment; it is merely a new version of the extractive practices of plantation capitalism that have been so damaging to Maui’s culture, environment, and economy for over 100 years.”

“The Mahi Pono case study illustrates the importance of early community engagement and ongoing partnership in land-based investing,” says Delilah Rothenberg Founder and Executive Director of the Predistribution Initiative, a multi-stakeholder effort to improve investment structures to share more wealth and influence with workers and communities, and ultimately address systemic risks including income inequality and climate change.

“With capital flows that are so intermediated, meaningful relationship development is often overlooked by distant investors – even asset owners and allocators who are taking measures to integrate ESG. Yet this lapse jeopardizes investors’ returns and perpetuates legacies of colonialism, with foreign powers undervaluing the risk that locals take and the value they offer with their land, resources, and labor,” concluded Rothenberg.

“Large private market agricultural land acquisitions in Hawai’i are all too familiar – wealthy investors parachuting in, missing a golden opportunity to ‘build back better’ for all impacted community stakeholders,” says Lisa Kleissner, impact investment pioneer and co-founder of Hawaii Investment Ready. “While access to water is the hook in this report, the water issue serves to underscore the lack of alignment between Mahi Pono’s objectives and the community’s needs. This report comes to the rescue by laying out in clear, pragmatic terms how Mahi Pono LLC and, for that matter, any private investor in agriculture can move investor/community discourse to a new, mutually beneficial level. First, ancestral rights must be acknowledged and addressed. And secondly, the business and financial model must demonstrate evidence-based community-aligned economics.”

The report shows how investors use the language of ESG and impact investment to promote, and invest in, economic opportunities that do not necessarily have a net positive ESG benefit. Responsible Markets calls on PSP and its staff to meet directly with community members and other stakeholders on Maui to understand the problems Mahi Pono is causing as well as the missed opportunities for positive transformative investment. True community intelligence is invaluable and cannot be outsourced to investment managers and advisors.

Mahi Pono farmers pivot amid pandemic

Maui News
by Kehaulani Cerizo –

New crops go to market; 3,500 acres of plantings slated this year –

Wind. Drought. Pests. Farming in Central Maui already holds a unique set of challenges. Add a global pandemic and agriculture operations are tested in a whole new way.

So Mahi Pono, the largest agriculture company on Maui, has made key changes to its operations in light of coronavirus.

The pandemic affected everything from shipping costs — a 46 percent increase in Young Brothers rates took effect last year — to in-field work that needed COVID-19 safety protocols. Restaurants and hotels — major markets for local produce — closed, causing the company to look at the type and scale of its crops.

One bright spot of the pandemic is that it emphasized the need for food sustainability, making farming more essential than ever, Mahi Pono officials said.

“We’re an island state that continues to import about 90 percent of all of our food; that makes us vulnerable every time there’s a natural disaster, shipping issues or a global pandemic,” said Shan Tsutsui, Mahi Pono chief operating officer.

During a recent farm tour, Tsutsui and Mahi Pono officials discussed the pandemic’s impact on last year’s farm plan and products made available in 2020, along with adjustments they’ve made to this year’s plan.

They highlighted the Chef’s Corner project, a test plot for new crops; the progress of the company’s community farm, which rents parcels to local farmers; and recent plantings that have done surprisingly well, including watermelon, broccolini, kale and green beans.

Instead of producing a signature crop, Mahi Pono wants to be known for an array of locally grown foods — a big departure from the monocrop of sugar cane that has occupied Central Maui fields for more than a century.

“Transforming former sugar cane fields into diversified agriculture is not an easy task,” Tsutsui said. “It takes time, hard work and financial commitment.”

Watermelon for the people

Chase Stevenson, Mahi Pono Chef’s Corner farm manager, showed off its rows of green, yellow and purple beans, butternut and kabocha squash, red kale, green kale, dinosaur kale, bok choy, green onions and orange sweet potato.

The corner, comprising about 40 acres of organically managed land off Maui Veterans Highway, tests what works best for Mahi Pono farmers and for the market, Stevenson said. From there, farmers scale and grow. Each time the crop is rotated, it improves the soil.

Stevenson, who has about a decade of Maui farming experience at Kula Agriculture Park and in Haliimaile, said farming in the central plains is both challenging and rewarding.

“You never know what you’re going to run into. It is fun even though it doesn’t sound fun — it keeps things interesting,” Stevenson said, laughing.

Some crops, such as watermelon, were a pleasant surprise. Watermelon grown on about a half-acre was consumed almost entirely by the local market with the remainder shipped to the Big Island, Tsutsui said. Because it was a hit, watermelon fields will be expanded with yields scheduled for summer.

Darren Strand, vice president of agricultural outreach and business development, said the company is learning that beans, broccolini and kale do really well, but with COVID-19 causing restaurant and hospitality markets to scale back, it’s hard to move produce that would typically sell easily.

“Anything you grow with a good quality and a consistent supply, you are going to be able to move,” Strand said. “Hopefully things are going to turn around in the next month or so and we will be positioned with this project, and some potatoes, onions and papayas, to be ready to hit that and run.”

Farther south, sweet onions are at various stages of growth, with some ready for April or May harvest. Non-GMO solo and sunrise papaya trees that were sticks last year have shot up and are producing well.

In all, Mahi Pono will plant more than 3,500 new acres of crops this year, according to Grant Nakama, vice president of operations.

Another program, the Mahi Pono community farm, expects tenants to move in by the end of this month. The program provides “farm ready” land, including water, to local growers for $150 per acre a year. Tentative agreements have been reached with 14 farmers and small businesses for an initial 60 acres. A second phase of community farmland will add more acreage, officials said.

Pivoting amid the pandemic

Despite the pandemic, Mahi Pono last year brought its products to market under the Maui Harvest brand. Potatoes were sold at Whole Foods in Kahului, Honolulu and Kailua; watermelon, KTA Market in Hilo; papayas, Takamiya Market in Wailuku; watermelon, potatoes, eggplant, Pukalani Superette; papayas, Target in Kahului; broccolini, Tamuras in Kahului and Lahaina; and watermelon, Times Supermarket in Kihei and Honokowai.

An extra emphasis was placed on row crops after the onset of the pandemic in order to provide more locally grown potatoes, onions and papaya.

“This shift allowed us to donate more than 60,000 pounds of produce to nonprofit organizations like Maui Food Bank, Hawaii Foodbank and Chef Hui that directly helped those in need,” Tsutsui said.

Another area of growth despite the pandemic was Mahi Pono’s staff. The company went from 150 employees at the start of 2020 to about 260 employees at the beginning of this year.

“As an essential business during the pandemic, we were fortunate to be able to continue farming, expand operations and hire more employees,” said Mark Vaught, vice president of farm development.

Vaught, Nakama and Tsutsui were promoted in 2020. Tsutsui succeeded Tim O’Laughlin, who relocated to California to focus on new initiatives for both Mahi Pono and Pomona Farming, a news release said.

When it cames to water in 2020, Nakama said Mahi Pono made “every effort to be efficient.”

In 2020 the company diverted an average of 22.7 million gallons per day from East Maui — below the state interim in-stream flow standards and half the allowable water allocation under the Alexander & Baldwin revocable permit, he added.

“The amount of water was the minimum needed to support our agricultural operations and to meet our obligations to the County of Maui for Upcountry residents and water users,” Nakama said.

Looking forward, he said the company will continue to divert only what is needed to meet crop and Maui County obligations.

For ‘generations to come’

Mahi Pono, a joint venture between a California farming company and a Canadian pension fund, acquired 41,000 acres of former sugar cane land and half of the East Maui Irrigation water delivery system from Alexander & Baldwin in late 2018.

Since the purchase, Mahi Pono officials have said they should be viewed separately from A&B, which has a controversial history of water use and sugar cane operations.

Still, Albert Perez, executive director and co-founder of environmental group Maui Tomorrow Foundation, said the future of the new company remains uncertain because A&B has a hand in its success due to A&B’s control of East Maui water rights.

He added that the foundation is working with regenerative farmers to provide Mahi Pono a list of suggestions that will boost soil fertility, reduce and eliminate the need for pesticides, minimize windblown dust and increase the water retaining capacity of the soil.

“However, we are hopeful that under the leadership of Maui native Shan Tsutsui, sustainable, value-added agriculture that provides local food security will truly be the goal,” said Perez, who recently toured the farm.

Tsutsui, the former Hawaii lieutenant governor, said his life has been dedicated to public service. He said he sees Mahi Pono, which provides student internships and nonprofit programs, as the next chapter of community outreach.

“For me, it has been rewarding to be able to be a part something that’s going to have a major, positive impact on our community for many generations to come,” he said. “Not only are we growing crops for consumption, but we are also ensuring that Central Maui will remain undeveloped and in agriculture well into the future.”

Tsutsui said that in its short time, Mahi Pono has been working tirelessly, especially during a pivotal pandemic year. This includes clearing the land, researching the best crops that would thrive in Central Maui’s soil and climate, investing in modern farming technology and equipment, planting and maintaining fields, and implementing a food processing system and distribution channels.

It also established relationships with distributors, wholesalers and chefs to get Maui Harvest produce into stores, restaurants and homes, he said.

But like all worthy endeavors, changing the course of history will take time, Tsutsui said.

“We still have a long a road ahead,” he said. “We really want the public to be patient and understand that this will take time, but we are committed to delivering quality, Maui-grown produce.”

* Kehaulani Cerizo can be reached at



Crops already in the ground:

• Citrus: More than 1,800 acres. Along Haleakala, Maui Veterans and Kuihelani highways and Central Maui interior fields.

• Coffee: More than 150 acres. Right below Pukalani.

• Potato: More than 50 acres. In western fields between Maui Veterans and Kuihelani highways.

• Onions: More than 50 acres. In western fields between Maui Veterans and Kuihelani highways.

• Papaya: More than 20 acres. In Central Maui interior fields.

• Avocado: More than 10 acres. Near Maui Humane Society and Maui Veterans Highway.

Planting this year:

• 3,500 more acres of citrus.

• 150 more acres of coffee.

• Replanting onions and potatoes.

• 20 more acres of papaya.

An additional 20 acres to be planted in the Chef’s Corner project (in western fields between Maui Veterans and Kuihelani highways), which will serve as a test plot for potential new crops.

Planting crops — and carbon, too

Washington Post
Story by Gabriel Popkin –

Maryland farmer Trey Hill pulled in a healthy haul of corn last fall and then immediately planted rye, turnips, clover and other species, which are now spreading a lush green carpet over the soil. While his grandfather, who started the family farm along the Chesapeake Bay, always planted in the spring in a clean field, in Hill’s approach to farming, “you never want to see the ground.”

As the winter cover crops grow, they will feed microbes and improve the soil’s health, which Hill believes will eventually translate into higher yields of the crops that provide his income: corn, soybean and wheat.

But just as importantly, they will pull down carbon dioxide from the atmosphere and store it in the ground. Hill is at the cutting edge of what many hope will provide not just a more nature-friendly way of farming, but a powerful new climate solution.

In early 2020, he became the first seller in a privately run farmer-focused marketplace that paid him $115,000 for practices that, over the past few years, had sequestered just over 8,000 tons of carbon in the soil. The money came from corporations and individuals who want to offset carbon dioxide produced by their activities. Hill used the proceeds to buy equipment he hopes will allow him to squirrel away even more of the planet-warming gas.

If farmers throughout the world adopted similar “regenerative” methods, experts estimate they could sequester a sizable chunk of the world’s carbon emissions. The idea has been endorsed by soil scientists, a slew of food industry giants and, recently, President Biden.

But some doubt that farmed soils can reliably store carbon long enough to make a difference for the climate — or that changes in soil carbon can be accurately yet affordably measured. Others worry voluntary measures such as soil sequestration could make a polluting food and agriculture industry appear environmentally friendly while forestalling stronger climate action.

Researchers and companies are now racing to reduce the scientific uncertainties and win over skeptics.

Many scientists are confident that farming can be adapted to build carbon into soils, said Deborah Bossio, a soil scientist at the Nature Conservancy, an environmental organization. “We know how to do it,” she said.

Agriculture has done a masterful job of feeding the world’s burgeoning population. It has been less wonderful for the climate. For thousands of years, plowing has mixed underground carbon-containing compounds with atmospheric oxygen, creating carbon dioxide, the main greenhouse gas that is driving global warming. Researchers estimate that farming throughout history has unearthed roughly 133 billion tons of carbon, an amount equal to almost 14 years of global emissions at current levels.

To prevent climate change from irrevocably damaging human civilization and the world’s ecosystems, humans must reduce carbon emissions enough to prevent the average global temperature from rising more than 1.5 degrees Celsius above preindustrial levels, scientists say. Some areas of the planet have already passed that threshold.

[Dangerous new hot zones are spreading around the world]

As scientists came to appreciate the threat posed by climate change over the past few decades, some wondered whether carbon already in the atmosphere could be captured and returned to the soil. A team led by Bossio estimated in early 2020 that if soil was protected and replenished globally, it could provide nearly 10 percent of the carbon dioxide drawdown needed to avert near-term climate catastrophe.

Soil carbon building practices, loosely gathered under the term “regenerative agriculture,” have been practiced for decades, or centuries in some places. Planting without tilling the soil took off after the devastating Dust Bowl in the 1930s spurred a search for ways to avert further soil loss, and the practice now includes more than a fifth of U.S. farmland. Maryland has paid farmers to plant cover crops since the 1990s to stanch the flow of nitrogen into the Chesapeake Bay. Some livestock producers rotate animals on pastures of grasses and legumes, whose roots pull carbon underground. And though rare in the United States today, farmers elsewhere in the world mix trees into fields and pastures.

Hill, who farms 10,000 acres, admitted he got into cover crops purely because the state paid him. “We had no intent of doing it for climate,” he said.

But he has since become a true believer. He now mixes rye and other fast-growing grasses with legumes such as clover and lentils, whose roots host nitrogen-fixing bacteria. He also plants root crops such as radishes and turnips to loosen and aerate the soil. While most farmers kill their cover crops in March, as soon as the state allows, Hill lets the plants grow taller than he is, to maximize root mass and carbon gains. He kills them just before planting his cash crop in May.

“The longer the cover crop is alive, the better off we all are,” he said.

There are barriers that keep more farmers from following his lead, Hill said. He has had to buy specialized equipment, and climate-friendly farming hasn’t yet translated to higher yields or premium prices.

“It’s a b—- to farm this way,” he said. Turnips can get stuck in his planting equipment, costing his team valuable time, for example. “It makes life a lot more difficult, and not necessarily more profitable.”

Hill sells most of his corn to the chicken producer Mountaire Farms, which pays him the same market price other suppliers get. If farmers were paid for the carbon accumulating in their soils, they would have greater incentive to adopt climate-friendly practices, Hill said.

But implementing that idea is challenging. Carbon accumulates slowly in soil, and past attempts to pay farmers for it have failed when the costs of verifying carbon gains exceeded what buyers were willing to pay. Backers of new, private-sector carbon markets hope that computer models fed by data from farm fields, satellites and handheld carbon sensors can measure and predict soil carbon gains more cheaply and reliably.

Hill connected with one of those markets, a Seattle-based tech start-up called Nori. After lengthy negotiations, credits representing carbon stored in some of Hill’s fields went on sale in October 2019 at $16.50 a ton — around the most an acre of his farmland might capture in a year, Hill said. Buyers included the e-commerce company Shopify, Arizona State University and individuals looking to offset the carbon their activities produce.

Nori eschews traditional soil tests, which can cost thousands of dollars for a large farm, and instead relies on third-party audits and a U.S. Agriculture Department computer model called COMET-Farm that estimates greenhouse gas emissions from farms.

Nori has competitors. One is Indigo Ag, a Boston-based ag-tech company that has lined up corporate customers including JPMorgan Chase, Boston Consulting Group and Dogfish Head to buy credits for carbon stored in more than a million acres of farmland across 21 states. After farmers upload their 2020 data, Indigo will calculate the amount of carbon stored and verify the numbers with a third party, a process that could take six months.

Still, the emerging market has hit speed bumps. Nori hoped to enroll more than 100 farmers in 2020, but so far, only Hill and an Iowa farmer have sold credits on the marketplace, with three more in the final stage of verification, according to Radhika Moolgavkar, a Nori program manager. At least one potential buyer, Microsoft, which has pledged to go “carbon negative” by 2030, turned down Nori’s credits because they weren’t backed by physical soil samples, Moolgavkar said. A Microsoft spokesperson declined to confirm that account.

“We’re seeing market formation in real time,” said David LeZaks, a senior fellow at the Croatan Institute, a nonprofit organization that researches sustainable investment.

The maturation of soil carbon science has complicated matters. Reduced tillage, already practiced by thousands of farmers, was once considered a major climate win because researchers saw carbon accumulate near the surface of untilled soils. But studies that sampled deeper soil layers revealed that carbon was lost there, wiping out most of the apparent gains.

Cover crops, whose roots and stalks add organic matter to the soil, have become the hotter item. A recent global meta-analysis estimated that if cover crops were planted on 15 percent of the world’s cropland, soils could soak up between 1 and 2 percent of all fossil fuel emissions. In December, Biden announced he wants to pay farmers to plant cover crops, and his USDA transition team has called for setting up a “carbon bank” within the first 100 days of his administration that would pay farmers, ranchers and forest owners for climate-friendly practices.

The USDA already offers three-year grants to encourage farmers to grow cover crops, but those have had limited impact. A 2017 USDA census found that cover crops were grown on less than 4 percent of American cropland.

Some researchers have questioned the practice’s climate benefits. In papers published last year based on long-term research plots in Iowa and California, scientists reported that when they measured carbon in soil to a depth of a meter or more, the gains of cover crops largely disappeared, similar to what had happened to no-till. By contrast, organic farming may do more to build deep reserves of carbon, those and other studies suggest.

Last year, the World Resources Institute, a leading Washington environmental nonprofit organization, stirred debate when it published two blog posts strongly questioning whether farming practices could make a meaningful dent in climate change.

Tim Searchinger, a researcher at Princeton University and senior fellow at WRI who was the lead author of both posts, says cover cropping and other regenerative practices are good for soil and the environment generally, but their carbon drawdown rates are too low to play a major role in averting climate disaster.

“An overfocus on soil carbon is a diversion from the climate strategies that can have a bigger impact,” Searchinger said in an interview. These include restoring carbon-absorbing peatlands, reducing methane emissions from cattle and other ruminants, and increasing the productivity of existing farmland to discourage deforestation.

Soil-based strategies are also limited in duration. Sequestration rates are highest in severely degraded soils, and after a few decades of climate-friendly farming, most soils become saturated with carbon — a fact not always noted by regenerative agriculture promoters, said David Powlson, a researcher at Rothamsted Research in Britain, which hosts the world’s longest-running agriculture experiment: “It’s not like getting rid of a coal-fired power station and replacing it with renewables, where exactly the same carbon savings is happening every year.”

Some fear emerging carbon markets risk wasting a rare opportunity for broader agricultural changes while giving corporations cover from more stringent climate regulations. Large industrial farmers such as Hill already benefit from a bevy of government programs, critics point out, while small-scale farmers with limited acreage will struggle to tap into markets. Expanding existing programs that pay farmers to grow native vegetation rather than crops could be a more cost-effective way to achieve climate benefits, others say.

Still, regenerative agriculture practices appeal to many experts because they’re field-tested and ready to be implemented.

“They are relatively inexpensive, relatively easy to adopt, and have a huge area of land where they’re suitable, and they have tremendous momentum and provide huge benefits to farms,” said Eric Toensmeier, a consultant with Project Drawdown and author of a recent report comparing the climate benefits of dozens of farming practices. “Cover cropping is one of the lowest hanging fruits.”

For Hill, the money from Nori was nice, but he doubts it will be enough to get more traditional farmers off the sidelines. An acre of single-species cover crops could cost $25 to $40 to plant; a biodiverse mix like Hill’s can run $65 an acre. And unlike Hill, most farmers can’t get payments from their state.

Still, between emerging carbon markets, a potential federal program and consumers waking up to the climate costs of food production, Hill is confident that he’s making a move that will be good for both the planet and his bottom line.

“Soil health,” he said, “should be the solution to climate change.”

Can we finally standardize ESG standards?

By Tim Mohin

Most GreenBiz readers are well aware of the complex sustainability reporting landscape. It seems like every year new reporting standards or frameworks are added to the overstuffed workload of the corporate sustainability professional.

As the former chief executive of the Global Reporting Initiative (GRI), I had a role in the ongoing movement to “standardize the standards” that companies use to report their sustainability results. I also worked on the corporate side (Intel, Apple and AMD) and have a deep appreciation of the work that goes into these reports.

Over the years, there has been more talk than action on reducing confusion and burden in the reporting space. To be fair, some of the burden is self-inflicted by companies that insist on publishing 100-plus page sustainability reports.

As we enter 2021, there are strong signals of meaningful change in the sustainability reporting world. Three main trends are emerging:

Mandatory disclosure: Policymakers are increasingly requiring ESG disclosure around the world. For example, the European Union (EU) will tighten its “Non-Financial Reporting Directive” in 2021, which requires environmental, social and governance (ESG) disclosure from companies with more than 500 employees doing business in the EU. And it’s likely that the incoming U.S. administration will introduce new ESG mandates as well.
Investor demand: There were record inflows to ESG investment funds in 2020 and the total tops $40 trillion — larger than the entire U.S. economy. Major asset managers such as BlackRock are using their ownership stake to pressure companies to improve their ESG disclosures.
Consolidated ESG standards: Recently, four leading ESG standards organizations — GRI, the Sustainability Accounting Standards Board (SASB); CDP (formerly the Carbon Disclosure Project); the Carbon Disclosure Standards Board (CDSB); and the International Integrated Reporting Council (IIRC) — declared their intent to collaborate. While this is a welcome signal, all of this work could be rendered moot by the International Financial Reporting Standards (IFRS) Foundation’s proposal to develop ESG standards. One hundred twenty countries use the IFRS Standards as the foundation for company financial disclosure, making it more than likely that these countries will endorse and require companies to use the new ESG standards.
The IFRS Foundation received more than 500 comment letters on its sustainability standards proposal with many key stakeholders in support. Given the momentum, the IFRS Foundation seems well-positioned to accomplish the elusive goal of a single global ESG standard

I have stated publicly and will reiterate here that I strongly support the IFRS action. A globally accepted ESG standard will improve the quality and comparability of disclosure, unlocking investment and trade that will improve, rather than ignore, the sustainability needs of society.

But there are several key challenges to address:

1. Materiality: The mission of the IFRS Foundation is “to develop standards that bring transparency, accountability and efficiency to financial markets around the world.” The concerns of financial markets are a subset of the broader concerns of sustainability. The IFRS Foundation must adopt a broader view to create transparency for sustainability issues that may not yet be financially material to companies or investors but are very important from a sustainability lens. Many companies already report on ESG matters beyond the scope of financial materiality and, as we saw in the pandemic, the definition of materiality is fluid and dynamic. It’s crucial that the IFRS articulates a strategy to straddle the boundary of “dual materiality,” enabling transparency on issues important for financial reasons and important to people and the planet.

2. Comparability: Many have criticized the lack of comparability in sustainability disclosures. Sustainability, unlike financial matters, includes a vast array of disparate issues that are not easily compared. An example is reporting on gender diversity vs. greenhouse gas emissions: Both are well within the scope of sustainability reporting, but obviously can be neither compared nor offset. As such factors cannot be reasonably merged into a sustainability score, they must be compared within the boundaries of the topic. The IFRS should emphasize the inherent lack of comparability between disparate ESG issues.

To enhance ESG comparability, the IFRS should consider the concepts in the International Business Council/World Economic Forum report: “Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation.” It outlines a series of universal metrics drawn from existing ESG standards. Setting aside the selection of the metrics, universally required disclosures will provide greater consistency of reporting across sectors and thus increase the quality and comparability of reporting.

3. Capabilities: The IFRS’s competency and credibility in the development of globally accepted financial disclosure standards makes them a natural hub for this work. But, because they have little experience with ESG issues, they will need to hire staff with sustainability credentials. And as they develop the standards, the IFRS must engage recognized experts in each respective topic that represent all relevant sectors, geographies and stakeholders. Blending sustainability expertise with the IFRS core competencies will not be easy, but is essential for the success of this proposal.

4. Technology: The sad fact is that the tools for gathering, auditing and reporting sustainability information are poor. The IFRS should incorporate the latest reporting technology into its sustainability standards. Information technology will not only reduce the burden of reporting, it will make it more actionable. Technology also will improve the quality of reporting, thus making it more reliable for investors and stakeholders and thus more effective in driving sustainability benefits.

After 35 years working in this field, it’s rewarding to see the rapid maturation of the sustainability movement. By taking on ESG standards, the IFRS Foundation is forging a path toward a global common language for sustainability. It is also confirming that sustainability has moved into the mainstream of global commerce. In essence, this signals the alignment of capitalism with the needs of people and our planet — and not a moment too soon.