Food and beverage giant Mars, Incorporated, has joined up with healthy food brand Danone to launch the Livelihoods Fund for Family Farming (Livelihoods 3F), an impact fund aimed at helping companies sustainably source materials from smallholder farmers in developing countries.
The companies will commit €120 million to the fund to be invested over a 10-year time frame into projects in Africa, Asia and Latin America alongside not-for-profit organisations. Each investment will be between €3 million and €5 million.
“It will provide upfront financing and technical support to NGOs and farmers’ organisations that will implement the projects in the field with farming communities,” reads the release.
The fund also hopes to attract commitments from other companies keen to secure sustainably-sourced agricultural products for their businesses. There won’t be a formal fundraising process, but a more informal one to one discussions with interested parties, according to a spokesperson at the fund.
Livelihoods 3F will operate as a mutual investment fund with three main objectives: increase yields and farmer incomes; empower farmers, especially women, and improve their livelihoods; and promote responsible farming practices and technologies.
But it will also make financial returns by attracting investment from both the public and private sector for the benefits generated by the projects. Examples are the purchase of carbon credits from the fund or investment from a utilities company for water savings. Government agencies and development finance institutions might also contribute to certain initiatives that provide positive social and environmental outcomes.
Danone has initiated an impact fund before; the first Livelihoods Fund was a carbon investment fund joined by nine companies – Schneider Electric, Crédit Agricole, Hermès, SAP, Michelin, CDC Climat, Firmenich, Voyageurs du Monde and the French Postal Group. It invested into seven projects dedicated to mangrove restoration, rural energy and agroforestry.