Climate Change Data

Lending for African Farming Company (LAFCo)

Climate Impact & Sustainability Data (2023)

Reporting Period: 2023

Environmental Metrics

Total Carbon Emissions:523,230 tCO2e/year (estimated)
Scope 1 Emissions:42 tCO2e/year
Scope 2 Emissions:522,465 tCO2e/year
Scope 3 Emissions:529 tCO2e/year

ESG Focus Areas

  • Economic Empowerment
  • Food Security
  • Gender Equality
  • Environmental Sustainability
  • Climate Risk Management

Environmental Achievements

  • Reduced portfolio carbon footprint by approximately 75,000 tonnes CO2e compared to 2022 (though data inconsistencies acknowledged)
  • Improved carbon data reporting from borrowers in 2023 compared to 2022
  • MacsKen utilizes waste shells from macadamia processing for energy production.

Social Achievements

  • Reached approximately 43,210 smallholder farmers (44% female) across 9 countries
  • Supported 241 total jobs (163 direct, 78 seasonal, over 290 indirect)
  • Expanded into Uganda with Gorilla Summit Coffee Development Limited (GSC), aiming to reach 10,000 farmers
  • MacsKen engaged approximately 4,510 smallholder farmers (59% female) and sustained over 290 indirect jobs through Privam.
  • Initiatives such as distributing bags during harvest seasons reduced rejection rates and increased farmer incomes for MacsKen.

Governance Achievements

  • Became a signatory to the UN Principles for Responsible Investment (UNPRI)
  • Implemented an additionality tool to assess financial and non-financial additionality in investments
  • Strengthened impact management system
  • Improved reporting from borrowers on ESG metrics.

Climate Goals & Targets

Medium-term Goals:
  • Increase the number of smallholder farmers linked to SMEs
  • Increase new full-time equivalent jobs created in borrower companies
  • Maintain 35% female smallholder farmers
Short-term Goals:
  • Complete market studies in West Africa (expected in 2024)

Environmental Challenges

  • Challenging economic conditions in macadamia and cocoa sectors leading to declines in impact metrics (reaching smallholder farmers and sustaining jobs)
  • Limited access to financial resources for SMEs in SSA
  • Inconsistent and inaccurate carbon data reporting from borrowers
  • Reduced demand for macadamia nuts from Western markets due to the Russia/Ukraine war, inflation, and interest rates.
Mitigation Strategies
  • Secured a US$50,000 grant from AgDevCo for market scoping in West and East Africa to enhance origination strategy and capacity building
  • Implemented a software-enabled monitoring and reporting solution to improve data capture and monitoring processes
  • Actively engaging in recovery efforts with underperforming borrowers
  • Working with borrowers to improve the quality of carbon data reported
  • Developing action plans to address ESG areas for improvement identified during due diligence.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: IRIS+, Operating Principles for Impact Management, UNPRI

UN Sustainable Development Goals

  • SDG 1
  • SDG 2
  • SDG 5
  • SDG 8

LAFCo's investments aim to contribute to these goals through economic empowerment, food security, gender equality, and job creation.