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Farmland and timberland rise up climate agenda
For investors looking to build portfolios that are aligned with net-zero objectives, farmland and timberland have never been so important. Timberland has the potential to be a net negative carbon investment, thanks to the ability of forests to remove carbon from the atmosphere. Farmland’s carbon profile also compares favorably to other types of real assets.
In a keynote interview for the Agri Investor Impact Report 2023, Gwen Busby, head of research and strategy at Nuveen Natural Capital, explains that the key is for investors is to build profiles that balance their net-zero objectives with favorable risk-return outcomes. She further discusses that farmland and timberland typically offer very stable returns and can provide a hedge against inflation, while also providing benefits linked to natural climate solutions.
Topics discussed
- Defining natural capital solutions
- Meeting financial and environment targets with farmland and timberland
- Incorporating ESG and sustainability metrics into traditional analytic frameworks
- Climate benefits of farmland and timberland
- Generating verified carbon credits through natural climate solutions
- Managing and mitigating risk through diversified natural capital portfolios
- New opportunities in natural climate solutions
Related articles
The earth’s natural capital can be thought of as a stock of assets—air, lands and waters and their biodiversity— that yields a flow of benefits or ecosystem services over time. The flow of these benefits includes provisioning services such as food, fiber and timber as well as a broad range of regulating, supporting and cultural ecosystem services that drive the global economy and human wellbeing.
We provide the case for investing in timberland through five key principles, including the inherent carbon benefits of the asset class that further enhance the case.
Climate mitigation benefits can be realized by investing in nature-based climate solutions (NCS) and offer investors in land-based assets the potential to generate verified carbon credits from their investments.
