Incentives and business models for soil health

Project results are expected to contribute to all of the following expected outcomes:

• increased awareness about the value of investing in soil health and its various co-benefits for land managers, businesses (incl. the financial and insurance sectors), local authorities and civil society;
• increased opportunities for investments in soil health across value chains;
• novel opportunities for developing and diversifying income for land managers;
• enhanced cooperation and new partnerships across different sectors to significantly improve soil health and support the manifold soil functions;
• emergence of new value chains and products based on sustainable soil practices allowing consumers to make more informed decisions.

Healthy soils are the basis of many ecosystems services that we take for granted such as sufficient and safe food, clean water, clean air and an abundant biodiversity. They also underpin sustainable and resilient value chains (food and non-food) and contribute to our quality of life in urban and rural areas. The importance of soil health and the wider environmental, social and economic risks and consequences of land degradation are increasingly recognised across society (e.g. land managers, businesses incl. the financial and insurance sectors, local authorities and citizens overall).

The business case for investing in soils is diverse. It can include increasing revenues and developing novel income streams such as from Carbon Farming, reducing or avoiding risks and costs, enhancing reputation, open up finance opportunities and others. Investing in sustainable soil management and restoration is a long-term endeavour. Incentives are therefore needed to help sharing risks and costs, provide innovative finance options and/or reward production and consumption that promotes sustainable land use. Payment for ecosystem services such as carbon capture, clean water, clean air or biodiversity are possible mechanisms but many more are being applied and developed in accordance with the various needs (e.g. crowd-sourcing, certification schemes, funds for impact investment or from citizens and philanthropy).

Proposed activities will

• highlight the multiple dimensions of business cases for investing in soil health by the private and public sectors;
• provide a detailed analysis of existing models in Europe and internationally for creating incentives and for generating revenues from healthy soils. Financial and non-financial incentives shall promote a) sustainable soil management across various land uses and climatic conditions, b) products based on practices promoting soil health, c) consumption and certification practices conductive to soil health, d) the reuse of land and e) sustainable soil management in the context of the EU Taxonomy Regulation and the Sustainable Finance Disclosure Regulation;
• showcase “good examples” from Europe and internationally for investments in soil health and other types of incentives as well as for “innovators” that lead the transition towards sustainable soil practices, taking into account along with the context in which the presented measures work;
• co-design with stakeholders (e.g. businesses, citizens, local authorities) new models for promoting soil health where existing ones do not sufficiently cover the manifold needs;
• provide testing grounds for soil business cases and identify avenues for scaling up action on soil health, thus making sustainable soil management more profitable for farmers, foresters, businesses, municipalities and other actors;
• develop a comprehensive toolbox of incentives (existing and newly proposed ones) including recommendations on innovative ways of blending finance streams and policy measures. Tools shall be tailored to the needs of various stakeholders (incl. farmers and farmer organisations, foresters, businesses, non-for profit organisations, municipalities, civil society) and address the delivery of various ecosystem services (e.g. carbon capture, clean water, clean air, biodiversity) and land uses (e.g. agriculture, forestry, urban areas);
• provide recommendations for policy measures at EU and national levels to support the development of business models which promote soil health;
• establish communities of practice/roundtables for environmentally and socially responsible soil health “investors” (including civil society);
• develop material and carry out promotion events or campaigns to raise awareness regarding opportunities for soil investments;
• explore the potential of digital technologies to support the development of business cases for soil health.

In carrying out the tasks, consortia should build on existing studies for carbon farming, in particular those carried out under contract by the European Commission, such as the recently published “Technical Guidance Handbook – setting up and implementing result-based carbon farming mechanisms in the EU"^[1].

Proposals must apply the multi-actor approach, thus ensure the participation of a range of stakeholders with complementary expertise.

Digital Agenda

[1]^{https://op.europa.eu/en/publication-detail/-/publication/10acfd66-a740-11eb-9585-01aa75ed71a1/language-en}