Responsible Commodities Facility Cerrado Programme

Impact Goal: Preserve biodiversity and carbon stocks by incentivising farmers to avoid deforestation and land conversion Description: Sustainable Investment Management Limited (SIM), in collaboration with various stakeholders, has established the Responsible Commodities Facility (RCF) Cerrado Programme. This innovative financial mechanism aims to provide low-interest crop finance to soy farmers in the Cerrado region of Brazil, contingent upon their commitment to environmental sustainability. By leveraging Green Agribusiness Receivables Certificates (Green-CRAs), the programme intends to foster the production of deforestation- and conversion-free soy, addressing the critical challenge of native vegetation conversion for soy production.

The programme's innovative approach involves providing farmers with lower interest rates on crop financing in exchange for their commitment to avoid deforestation and land conversion. This model contrasts with grant-based initiatives by offering a self-sustaining, scalable financial solution. By integrating environmental commitments into the financing structure, the RCF aims to create a significant impact on sustainable agriculture, targeting the preservation of the Cerrado's biodiversity and carbon stocks.