Infographic : A guide to understanding the projects of the Livelihoods Fund

Summary

In 2008, Danone created the Danone Fund for Nature. Based on its successful experience with carbon offset projects launched in partnership with IUCN and the Ramsar Convention on Wetlands, Danone decided to invite other companies to join these initiatives by creating the Livelihoods Fund in 2011. Even though this carbon fund is now closed to new partner investors, its projects continue to flourish. What are some of these projects ?

04Fév.
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The Danone Fund for Nature is focused on 3 key areas : the restoration of natural ecosystems (mangroves, reforestation, REDD, etc.), agroforestry and sustainable agriculture projects, and rural energy/clean cookstove projects. According to Livelihoods, carbon finance presents both a means and an opportunity, not an end. Livelihoods is an investment fund, not a charity, and it invests in large scale programs aimed at generating long term sustainability and high social, economic and environmental value for the local communities. In return for their financial contributions, the fund’s partner investors receive high-quality carbon credits that they can use towards offsetting carbon emissions from their business activities and towards reducing their environmental footprint.

The current investors of Livelihoods Fund, which has a capital of 40 million euros, are 10 European companies : Danone, Schneider Electric, Crédit Agricole, Michelin, Hermès, SAP, CDC Climat, La Poste, Firmenich, Voyageurs du Monde.

Since its creation, Livelihoods has already planted more than 130 million trees, improving the livelihoods of more than one million people in Africa, Asia and Latin America.

In 2014, the 7 projects supported by the Fund are expected to generate carbon credits equivalent to 8 million tons of CO2 over the next 20 years.

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World tour of the projects

The Livelihoods Fund supports 7 projects in Asia, Africa and Latin America :

– In Senegal, in Casamance, with the help of the local NGO Océanium, 10,000 hectares of mangroves have been replanted (the equivalent of the total surface area of Paris!). The project benefits 200,000 people living in 350 villages.

– In India, in the Sundarbans archipelago, with the help of the local NGO NEWS 5,500 hectares of mangroves will be replanted, impacting 250,000 people.

– In India, in the Araku Valley, with the help of the local NGO Naandi Foundation, an agroforestry project will plant 6,000 hectares of fruit trees. 100,000 villagers will benefit from this project which will help increase their incomes.

– In Indonesia, on the island of Sumatra, with the help of the local NGO Yagasu, 5,500 hectares of mangrove will be replanted and 20,000 people will see a direct impact on their lives thanks to new businesses that will be spurred by the products of the planted mangrove trees.

– In Kenya, in the Embu region, with the help of the Kenyan social business Climate Pal, 60,000 clean cook stoves will be distributed, which will allow local women to cook using up to 60% less fuel wood: this will help curb deforestation and reduce the health risks for women that are associated with cooking over open-fire stoves (lung problems, sore eyes, etc.).

– In the north of Burkina Faso, with the help of the local NGO Tiipaalga, a clean cook stove project will provide training to local women so that they will be able to make their own cook stoves. The goal of this new project – it commenced in October 2014 – is to equip 30,000 households, with a minimum of 2 stoves per household.

– In Guatemala, in the region surrounding the Mountain Cerro San Gil, with the help of the local NGO Fundaeco, a recent agroforestry project (initiated in July 2013) will plant 5 million trees and crops of various species producing pepper, wood, coffee and cocoa, among other cash crops, helping not only to curb deforestation, but also providing extra income to impoverished local populations.

 

Credit-nicolas gauduchon 3

LIVELIHOODS LAUNCHES A SECOND FUND

On February 4, 2015, a new Livelihoods fund will be launched aimed at helping companies to learn how to sustainably source the materials they need from smallholder famers while at the same time delivering large-scale social and economic impact to those farmers and their communities.

The Livelihoods Fund for Family Farming (Livelihoods 3F) was born out of the realization that there is a great need for increased investment in global food security and agriculture, in particular from the private sector. With the world’s population increasing from 7 billion to 9 billion people in 2050, the need to produce more with fewer natural resources available is becoming more of a major challenge. Deforestation, land degradation, climate change and biodiversity losses are increasingly threatening ecosystems.

In both developed and developing countries, family farming is the predominant form of agriculture. 500 million family farmers today produce 70 percent of the world’s food supply. For those farmers and their families grappling with environmental degradation and poverty, having access to practices that increase their productivity and incomes while simultaneously preserving or restoring soil fertility, water resources and biodiversity is a major opportunity. However, small family farmers are not currently bankable investees for investment funds despite the fact that they dominate the supply side of many major markets like cocoa, coffee or rubber. Livelihoods 3F’s purpose is to aggregate these farmers and to integrate them into value chains with the positive impact benefits monetized to give a return for the fund.

Danone and Mars are the founding investors behind the newly-created Livelihoods Fund for Family Farming. Livelihoods 3F aims to invest 120 million euros in the next 10 years to implement projects in Africa, Asia and Latin America, helping more than 200,000 smallholder farmers and 2 million people and boosting the sustainability of their crops.

“Livelihoods 3F is based on the conviction that sustainable farming, climate change and poverty are closely linked,” said Bernard Giraud, President of Livelihoods Venture, a service company that will implement the fund.

“It is an open investment fund. All businesses that want to source agricultural and natural goods in a sustainable and responsible way are encouraged to join us and increase the breadth of our learning and our impact.”

“The challenges of sustainable agriculture can be met only if we are able to develop radically different approaches, combining economic, environmental and social objectives,” said Franck Riboud, Chairman of Danone’s Board of Directors. “The best way to find adapted, innovative and concrete solutions is to join forces with other companies, NGOs, government agencies. Besides, it is in this mindset that we created the first Livelihoods carbon fund in 2011. Today, we are launching with Mars, Inc., a second fund dedicated to family farming. It will enable us to work effectively with smallholder farmers in the field to contribute to our overall performance. We invite other companies to join us in these projects.”

Photo © Livelihoods / Nicolas Gauduchon