The &Green fund is a set up to invest in deforestation-free commodity production. The fund is now partnering with Hacienda San José (“HSJ”) for an ambitious sustainable increase of its operations in rural Colombia, ultimately impacting up to 180,000 hectares of degraded land through a mix of production, sourcing and ownership models. &Green will work together with HSJ to secure the protection and restoration of up to 27,000 hectares of tropical forest in Colombia’s underdeveloped Orinoquía region. The 12-year loan agreement of around USD 7.5 million allows for the development of a ‘blueprint’ for the transition to a more sustainable and deforestation-free Colombian cattle sector.
Transforming the Colombian cattle sector
This transaction marks &Green’s first investment in Colombia. Unsustainable, extensive cattle ranching is considered a major driver of deforestation in Colombia, and it typically operates on a low-productivity, low-cost basis with inefficient use of land and resources. This is unsustainable both from an environmental and economic perspective. The stocking density of Colombian cattle is estimated to be around 0.7 head per ha, compared to 1.3 on average in Brazil. Depending on soil quality, a well manged farm can typically support up to 4 heads per ha, largely reducing the need for grazing land. Colombia’s cattle ranches make up an area larger than Germany.
&Green’s investment in HSJ helps to catalyse the transformation of the Colombian cattle sector by:
- Expanding HSJ’s sustainable intensification model across 180,000 hectares of degraded land – more and better-quality cattle per area without exhausting the soil.
- Protecting and restoring up to 27,000 hectares of forest, halting the destructive fire cycle and restoring soil health across the landscape.
- Fostering social inclusion through sharing of knowledge and cattle genetics, employment creation, and community engagement focused on education, health and gender equality.
- Sharing data and learnings with the industry to inspire positive change.
About the &Green Fund
The &Green Fund was set up to provide financial risk reduction for companies that want to transition to deforestation free production of soft commodities (e.g. soy, palm oil and cattle). It offers long term finance under conditions that are tailored to companies’ needs in return for strict environmental and social commitments by the companies. The specific commitments are specified in a Landscape Protection Plan (LPP) and an Environment and Social Action Plan (ESAP), which are integral to the legal loan agreement. The &Green fund is promoting transparency as a key element of their environment and social ambitions and are making both the LPP and the ESAP available at the webpage of the fund www.andgreen.fund. At present, the &Green Fund portfolio includes transactions in the palm oil, rubber, cattle and soy sectors in Indonesia, Brazil and Colombia.
The &Green Fund is an independent entity with a professional credit committee and board that makes investment decisions. The donors, which in addition to NICFI include the United Kingdom government, FMO (the Dutch development finance institution), Unilever and Global Environment Fund, are not involved in investments decisions.
For further details, see www.andgreen.fund