July 12, 2022

By Lynda Kiernan-Stone, Global AgInvesting Media

The Public Sector Pension Investment Board (PSP Investments), one of Canada’s largest pension investment managers with CAN$230.5 billion (US$177.4 billion) of net AUM, announced its partnership with WSP, a leading global engineering and climate consultancy group, to carry out an in-depth climate analysis on its entire Global Natural Resources (NR) portfolio. 

The undertaking will be carried out alongside PSP Investments’ local operating partners on more than 3 million hectares (7.4 million acres) of farmland and timberland. The analysis will include more than 400 individual properties across six countries, spanning a wide range of crops, including tree nuts, vineyards, fruit, grains, cotton, timber, and animal protein.

PSP Investments stated that the WSP climate analysis will integrate seamlessly into PSP Investments’ participation in the Farmland Management Standard led by Leading Harvest.

Leading Harvest is a non-profit organization consisting of stakeholders across the agricultural value chain – companies that farm, own, and/or manage farmland, along with two environmental groups that together have created a new entity providing the first scalable, industry-wide universal sustainability standard that can be applied across all crops and geographies to address issues from climate change to biodiversity, and the resilience of cropland and communities.

Developed by growers and agricultural experts with deep experience in boots-on-the-ground farming, Leading Harvest takes a flexible, ground-up approach to eliminating the barriers to quantifiable, unified sustainability standards that sets the stage for widespread adoption across the agricultural ecosystem.

The platform addresses 14 key sustainability principles from soil heath to water management, energy usage, air quality, conservation, and community interaction, as well as compliance with labor laws and regulations. And to ensure that the required outcomes are being met, Leading Harvest requires independent, third-party experts to audit producer performance across all categories of the standard.

“At its heart, Leading Harvest’s Farmland Standard is solution-oriented – meaning it gives farmers the ability to innovate and advance sustainability practices in pursuit of outcomes,” Oliver Williams, global head of Agriculture Investments, CIO at Manulife Investment Management, Timberland and Agriculture, and chairman of Leading Harvest, explained in April 2020. 

“This farmer-focused farmland standard can be applied to permanent crops, specialty crops and row crops alike, and across all regions and environments. To be in conformance with Leading Harvest’s standard, a producer aligns to best practices appropriate for their crop or region and demonstrates achieving outcomes in a continuous improvement framework.”

Dual Objectives

This portfolio analysis project has two main objectives. The first is to use farm-level data to establish a portfolio-wide baseline of PSP Investments’ NR greenhouse gas emissions (Scope 1 and 2). This information will provide the foundation for the development and implementation of a decarbonization roadmap to be used to reduce GHG emissions and to create science-based transition plans for portfolio companies.

“For WSP, the opportunity to work with a global organization like PSP Investments, which operates across such a broad range of crops, timber species and geographies, is unique and exciting,” said Mel de Jager, vice president, climate change, resilience, & sustainability, WSP.

“Through this work, not only will we be able to help PSP Investments and its partners fully understand the footprint of their greenhouse gas emissions, but we will have a real opportunity to advance knowledge of carbon sequestration on agricultural lands.”

The second objective will be to determine the sequestration capabilities of PSP Investments’ NR assets in regard to different carbon pools, such as biomass carbon, and soil organic carbon. This work will necessitate leveraging academic studies, third-party expertise, and the on-the-ground experience of local management teams to develop robust methodologies and identify appropriate data sources to consistently quantify and report biogenic carbon removal and storage.

“As a long-term investor and one of the leading global investors in agriculture and timber, we are highly committed to the continuous improvement of our sustainable farming practices around the world,” said Marc Drouin, senior managing director and global head of natural resources, PSP Investments.

“Farmland and forestry assets carry significant potential to support global climate mitigation and adaptation efforts, including through their carbon sequestration potential,” continued Drouin. “This ground-breaking project with WSP will give us the detailed, farm-by-farm information we need to help our platforms map out a path to global net-zero.”

~ Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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