Financing Good Food

The TakeAway: New Food Movements Get Funded from Social Finance and Social Enterprise – and Big Agra

The intersection between food and finance conjures visions of Big Agra, aka industrial agriculture – which is increasingly perceived as sacrificing the health of our planet, and we the people, to squeeze a profit.  But a growing series of movements (documented recently by their most articulate commentator, Michael Pollan) seek to reclaim the right to food that’s healthy for humans and our home.  Of course finance plays a role here, too – but a much different one from Big Agra.  Specifically, social enterprise and social finance have been stepping in to empower those on the lower end of the economic food chain to reclaim their right to food that’s “good” in all senses – good tasting, good for you, good for the environment, etc…

But before we talk about that, a quick primer on social enterprise and social finance, which enjoy popularity in the UK, Canada, and, to some extent, the US.  In the US, Greg Dees serves as a founding father of social enterprise:  Dees is the original architect of Harvard Business School’s Social Enterprise Initiative, Stanford’s Center for Social Innovation (CSI – which publishes the Stanford Social Innovation Review), and Duke’s Center for the Advancement of Social Entrepreneurship (CASE). Michigan State University’s C.S. Mott Group for Sustainable Food Systems numbers among a group of land-grant college programs that blend business concepts with social policy concerns, while promoting direct involvement at local levels.  On the social finance side, the Rudolf Steiner Foundation (RSF) plays a prominent role.  RSF specializes in social enterprise lending and helps nurture new ventures by connecting them with a variety of social finance institutions.

A few weeks ago, RSF announced the launch of the first of several Food and Agriculture Program-Related Investment (PRI) Funds.  With an aim of increasing financing flowing to social enterprises in local and sustainable food and agriculture, these PRI funds help foundations meet their fiduciary duties while investing in the kinds of programs their grants support.  RSF also participates in a nonprofit network of grantmakers called the Sustainable Agriculture and Food System Funders, and is also a member of Community Partners.   Roots of Change is another nonprofit network with similar aims.

These organizations see their work as more than just food:  it’s about building communities and “social equity”, providing skills training, and economic development — within the broader context of public health and even climate change.  Perhaps the best example of an organization operating at the intersection of food and finance is the Slow Money Alliance, which applies the concepts of Slow Food to money by encouraging investment of “patient capital” in local food systems.

The parallel interest in urban agriculture blends food production, nutrition education, and social enterprise.  The result: workable systems enabling everyone to have safe, equitable access to healthy food, as urban farm guru Will Allen, founder of Growing Power, puts it.  Even Kraft Foods has embraced it, encouraging consumers of its Triscuit crackers to grow their own food.  Last March, Kraft started enclosing seed packets in Triscuit boxes, and launched a Website with nonprofit Urban Farming.  This move circles back to where we started, with big companies working with NGOs to bring their marketing and financial muscle to help solve the looming food crisis.  The Sustainable Food Lab, a project of The Sustainability Institute that links big companies with activist NGOs and farmers on the ground, represents a similar, but more coordinated, effort – which raises the question of whether those perceived as causing the problems can create solutions through reform, or if we need a more radical restructuring of the economics at the root of our food systems.

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