City Food Finance Principles to Build Climate Value
Cities are engines of local economic innovation and future-building; they can be drivers of sustainable development across wider regions and conduits for impact investment and everyday transformation.
Cities are increasingly important in the work of shaping human access to health and wellbeing. As more of the world’s population moves to cities, decisions that determine whether air and water are clean and safe, and how food is acquired and distributed in local economies, may determine how long people live and how free they are to enjoy life.
National standards are important, for setting in motion broad-based efforts at innovation and scalable commercial breakthroughs. They are also important for setting legal boundaries for minimum acceptable safety and sustainability criteria.
Cities can spur innovation and steer investment in ways that are more locally fine-tuned, rooted, and scalable. One of the most important roles cities play in any regional economy is as an organizing engine to spur the development of markets, value chains, and innovation networks. This happens organically, but it can also be the focus of targeted incubation efforts, public investment, and enabling policies.
As global heating has intensified, spread, and begun compounding its effects, creating unprecedented costs and destabilizing disruptions, there is increasing concern that food supplies will become less stable and eventually fail. The ripple effects of a major food supply failure would be global and could rival the COVID-19 pandemic in terms of disruption of everyday life and economies large and small.
The Climate Value Exchange is drawing on work done through the Good Food Finance Network, the Food Trails initiative and its Impact Investors Living Lab, and the United Nations Food Systems Summit, to outline a series of principles that can support city-driven transformation of food finance. The aim is to create conditions for progress toward everyday exchange of value to build climate resilience and foster healthy, sustainable food systems.
The City Food Finance Principles to Build Climate Value are:
Common Reality – Health-building, nutritious, sustainably produced food should be an affordable, accessible everyday option for all.
Delivering Impact – Cities deliberately play the role of impact investor, to shape healthy, sustainable food environments.
Urban-Rural Feedbacks – Cities work with surrounding rural areas to support convergence of consumption, production, and incentives.
Multilevel Cooperation – Cities engage with regional and national authorities to support enhanced implementation of national climate, food, health, and biodiversity plans.
Co-Investment – Cities engage proactively to shape and mobilize investment partnerships linked to a broader Co-Investment Platform for Food Systems Transformation.
Tracking and Labeling – Cities act as critical intermediaries to support needed data systems integration and multidimensional metrics.
Each of these principles can support value-building investments that improve health, quality of life, and economic opportunity. Cutting across all six is the opportunity for cities and regional governments to reward impact investors that get capital and capability moving to innovative start-ups, effective community-based networks, and wider regional cooperatives.
A second cross-cutting area of action is the localization of financial innovation, to support the optimized increase of capital to micro-scale, and small and medium-sized enterprises that improve conditions in local economies. Here, we dig a little deeper, with select examples of action, to show how each of these six areas of work builds on and supports the others.
By emphasizing common reality—the benefit of a sustainable food economy that improves health, creates enjoyable experiences, and optimizes the usability of household income—it becomes possible to see how a unique, locally rooted start-up or cooperative can become either a scalable operation or a popular new trend.
Public incentives can facilitate investments that make sustainable food items more universally available and more affordable.
Such a program can tap into and drive local culture to consolidate gains and establish the custom of prioritizing better food.
One Health standards, considering the inherent health and resilience value of better treatment of ecosystems and livestock, can improve fiscal stability and free up resources for up-front investment in better practices and new business models.
This creates opportunities for high-impact, efficient incentives that build value for businesses, communities, and for planetary health.
Scaling locally rooted innovations can benefit from translating those innovations into local context elsewhere.
Cooperative agreements, including through the delivery of incubation capital and bridging funds, can deliver impact for communities, making them more livable, more walkable, more full of vibrant local activity, and more welcoming to new enterprises and the capital that supports them. The City of Milan has demonstrated an important practical lesson: By identifying where in its existing budget sustainable development priorities are already at issue, it was able to free up public resources, invest more wisely, and drive impact that resulted in mainstream investment in better practices.
Health-building, sustainably produced food, free from chemical additives, neurotoxins, and antibiotics, is more available when producers see an incentive to work through the risks and added labor of producing it. Doing so can yield important livelihood benefits, increasing incomes and allowing for more hiring and richer rural economies.
Targeting that kind of urban-rural feedback, where city economies create new opportunities across a wider landscape, will make it more affordable to create and sustain health-building resilience-oriented food economies in and around cities. The secondary effects of this everyday collaboration can improve health, expand economic opportunity, and raise revenues, for all jurisdictions involved.
Carrying the common reality principle forward, it is meaningful to not only get better food to everyone, regardless of income, and to tie urban and rural interests together, but to foster multilevel cooperation. When cities work with regional governments and national governments, to enact policies that build economic value while advancing high-level goals and local benefits, everyone wins. It becomes easier to grow the resilience economy, and to attract new pools of capital to innovative, sustainable start-ups.
Because food is an everyday consumer good and a reason for visiting new cities and neighborhoods, impact investment can create a foundation for mainstream investment, especially if it has targeted policy support. A co-investment platform, like the one in development through the Good Food Finance Network, can ensure resources are allocated in a way that is optimized to bring wider pools of finance to efforts that build value over time and expand mainstream financial feasibility.
While tracking and labeling are often treated as either a regulatory exercise or an activity of advocacy organizations, they are best deployed when embedded into commercial operations at small and large scale and across value chains. Small-scale local actors can be verifiers that are compensated for neutral, fact-based determination of funding levels and timing of resource allocation, based on scientific observation and the need to expand clearly marked healthier and more sustainable products, at competitive prices, to local economies.
Contrary to the headline politics of our moment, Climate Value and sustainable food systems are mainstream investment opportunities. The question is which public authorities are best positioned to enact policies that reveal and expand that opportunity. As we move forward with discussions around multilateral climate cooperation, we see cities playing a key role in unlocking impact investment and scaling innovative start-ups.
Resource Library
Explore an interactive resource library linked to the City Food Finance Principles, to access related reports and more detailed notes on innovative policy and financing approaches.
Building food-related Climate Value
We will report on each of these principles, in line with connected projects like Resilience Intel, Reinventing Prosperity, the Good Food Finance Network, its Co-Investment Platform, and the Integrated Data Systems Initiative.
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