Food Value Chain

Status: We are currently compiling members for our Technical and Industry Working Groups. If you are interested in contributing to the development of these criteria, please do not hesitate to contact us.

Timeline of Development:

Aug 2024: Technical Working Group (TWG) Launch

 

 

Overview: The Food Value Chain contributes significantly to global greenhouse gas emissions, accounting for about one-third of agri-food system emissions. This sector encompasses all post-farm activities, including:

• Transportation
• Processing
• Packaging
• Storage and distribution
• Retail
• Food service
• Household consumption
• Waste disposal

Key facts:

• Agrifood systems cause 35% of global emissions
• Food Value Chain emissions are rising faster than farm-level emissions
• Main emission sources: food waste (7.9%), household consumption (7.3%), retail (4.2%)

As global population grows and consumption patterns shift, addressing Food Value Chain emissions becomes crucial for climate mitigation. This is especially important in high and middle-income countries, where these emissions are increasing rapidly.

Focusing on energy efficiency, waste reduction, and sustainable practices throughout the Food Value Chain can significantly impact overall agrifood emissions and support global climate goals.

What's Included: The criteria for the Food Value Chain will include the establishment of guidelines aimed at maximising viable bond issuances. These guidelines will enable stakeholders to identify investments that deliver measurable climate mitigation benefits or demonstrably increase the adaptation and resilience of food value chain operations to the impacts of climate change. The Technical Working Group has overall responsibility for the content of the criteria, which should be achieved by consensus.

In developing the Food Value Chain Criteria, the Technical Working Group will need to balance the following objectives:

• Define scientifically robust, verifiable targets and metrics.
• Base the criteria on transformation pathways that account for differences in context across various parts of the world and at different stages of the food value chain.
• Ensure the criteria are usable by the market and understandable for non-scientific audiences.
• Make the criteria feasible, realistic, implementable at scale, and affordable.
• Achieve climate outcomes without creating negative environmental and social impacts.

Why It Matters: Food Value Chain emissions vary significantly across countries and sectors, demanding tailored reduction strategies. In developed nations, post-production activities dominate agrifood emissions, while high-income consumption patterns drive global emissions. Addressing these challenges requires a holistic approach integrating sourcing practices, operational efficiencies, and consumer behavior modification.

Key actors in high-income countries' food value chains, such as retailers, manufacturers, and distributors, hold significant leverage for change. They influence upstream emissions through procurement, address their operational footprint, and shape consumer choices affecting both upstream and downstream emissions. While production-level emissions remain highest globally, post-production sectors capture most climate finance, with manufacturers and distributors receiving the largest share due to their economic clout. This positions them as crucial drivers of agri-food system transition through strategic financing deployment.

Several critical intervention areas have been identified across GHG emission categories and value chain stages. Reducing food loss and waste, along with shifting consumption away from high-emission animal proteins, offer the greatest mitigation potential. However, effective strategies are highly context-dependent. Other promising areas include increasing renewable energy use and energy efficiency in food preparation and storage, developing green cold chains, adopting climate-friendly freight transport, and optimizing transport use. Climate-friendly packaging and green facilities may also contribute, though their global impact is harder to quantify. While sourcing practice changes significantly influence emissions across the value chain, current quantification efforts mostly focus on deforestation-free sourcing, addressed in separate Climate Bonds Criteria.

Applicability: The Climate Bonds Standard and Certification Scheme is intended to provide an easy-to-use screening tool that provides a clear signal to investors and intermediaries on the climate integrity of Certified Climate Bonds. At the core of the Standard is a suite of sector-specific eligibility Criteria which sets climate change benchmarks that are used to screen debt instruments, assets and/or entities, to ensure the integrity of their contribution to climate mitigation, and/or to adaptation and resilience to climate change.

Climate Bonds Team: 

Reyes Tirado Agri-Food Standard Lead

Aishwarya Sankar Sustainability Analyst

Technical Working Group:

Each TWG member contributes to the criteria development in their personal capacity and as a content experts in the field. This contribution does not imply endorsement either from Climate Bonds Initiative to the organisation the member is currently employed with, nor of the organisation to this work.

If you have technical or industry expertise in the sector and would like to collaborate in this work, reach out at aishwarya.sankar@climatebonds.net.

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Ruth Rennie Criteria Technical Lead Rennie Sustainability Consulting		Dr. Souhir Hammami Director Scientific and Technical Information Department International Institute of Refrigeration (IIR)		Dr. Shenggen Fan College of Economics and Management China Agricultural University Beijing		Dr. Prajal Pradhan Agricultural Engineering and Environmental Management  University of Groningen		Francesca Nugnes International Fund for Agricultural Development PARM
Isabel Nepstad CEO Bella Terra		Liyuan Wei School of Physics University of Sydney		Joe Robertson Executive Director Citizens' Climate International		Hassan EL Bari Professor IBN Tofail University		Dr. Christopher Martius Team leader, Climate change, energy and low-carbon development  University Centre for International Forestry Research (CIFOR)
Saloni Shah Green Economy specialist, Agribusiness European Bank for Reconstruction and development		DING Shanshan (Helen)  Green Supply Chain and Finance Director Institute of Public and Environmental Affairs (IPE)
Industrial Working Group: