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Why Renewability is a Better Business Goal than Sustainability — Quartz

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It seems like every big company has a sustainability officer these days. So are oil majors.

The word is used so often and has so many different meanings that it is difficult to know whether it is part of a genuine movement to reduce harm to the planet and society, or whether companies are making it possible. It can be difficult to tell if it’s another smokescreen to do. No Change it in a meaningful way.

Either way, maybe it’s time to leave the descriptors behind.

Adrian Rodriguez, founder of a new investment bank in San Francisco, says sustainability claims are already making companies obsolete. According to Rodriguez, “maintaining” means benchmarking the current situation and keeping things at that level. But to solve the pressing problems of the earth’s reality, he says, nothing can be achieved by just maintaining something. Rather, we need an entirely new approach.

Rodrigues co-founded Provenance Capital Group (PCG) in January 2020 with a mission to encourage investment in “regenerative” rather than sustainable businesses. Most of his work to date has been in the agricultural industry, with companies such as World Tree, a renewable timber and agroforestry company, and White Leaf Provisions, a family-owned organic food brand.

Rodrigues spoke to Quartz about his vision and how his hopes for a better world “ebb and flow” with it. The transcript below has been lightly edited for length and clarity.

QZ: What is the difference between regenerative and sustainable approaches?

AR: Regenerative business is different from the current paradigm. Older models of business tend to be fairly linear and abstract. We have taken so much from natural systems and even our population that it has led to the collapse of our planet and our politics.

We need to redesign our economy, especially our food system, to be circular. What does circular mean? A system where everything feeds back to itself, strengthens the system and creates resilience. Normally, in nature, things break down, return to the nutrient cycle, and return in a different form. In the current “extract and deplete” linear system, [something] It is then put in a landfill, where it is not broken down into readily available nutrients, which actually causes many long-term problems.

This idea of ​​’focusing on sustainability’ is not the right way to think. Because the system has deteriorated. Just keeping them as they are is not resilience. they will not survive. We really need to invest in them to make them healthy again.

How excited are you about the possibility of building a new playback system?

[Laughs] It ebbs and flows. I entered the space in 2016 and was telling her mother that I was going to work in regenerative agriculture. She said, “What? What is it?”

However, in the last eight years [public awareness] I have grown more than I ever expected. It gives me a lot of hope. During the 2020 presidential debate, her mother called. They are talking about your regenerative farming! ”

When something moves from fringe to mainstream discussion, it signals that we are at a tipping point.

Why did you decide to focus on agriculture finance in particular?

This industrial system is not working in many farming communities. Farmer suicides are at an all-time high. Everything from fertilizers to what is happening in Ukraine is putting pressure on that system.

Funding this sector is difficult as all is spent on conventional farming. about 1% [of US farming] Being organic, less than 1% can actually be recycled. [But] It is not enough to make farmers aware of these practices, they need access to financing.

To what extent are you making a dent in that funding issue?

We are a sell-side investment bank focused on funding regenerative agriculture. We primarily work with companies that are considering Series A and B funding rounds, i.e. companies that are in the early stages. Our sweet spot is $5M to $25M in funding. If you’re in recovery funds, the sweet spot is around $50 million.

It’s hard to say how much money has flowed into this sector. [where crops are stacked in an indoor, highly technically controlled environment]I don’t see it as circular. Although it’s plant-based meat, I agree that meat consumption should be significantly reduced. [of it is] Comes from GMO crops. So it’s the same input. [as conventional meat]. of [meat substitutes] Those derived from fungi and mycelium are more interesting to me.

How quickly do you see the regeneration approach going mainstream?

We are on the cusp of some pretty big trends that give us a great opportunity to change how we interact with the food system.

Millennials are projected to inherit an estimated $41 trillion from Baby Boomers over the next 40 years. This is more cumulative wealth that has changed owners throughout history. It should come as no surprise that the new generation isn’t just focused on optimizing returns. They want a more holistic scorecard: What are their investments doing, not only from a financial standpoint, but also from a social environment standpoint? , could be easier for another generation. [rather] Rather than teaching an older generation that has entrenched how to think about that paradigm.

As with this wealth transfer, there will also be one of the biggest land moving in [the US], one generation of farmers will pass the land on to the next generation. About 100 million acres of land will change ownership in the next few years. we find the acreage, [farm it] In a holistic and regenerative way. This is another opportunity to redefine farming.

So i have hope. But you can’t rely on inertia and expect that to happen. We all have to work with a sense of urgency.