Description financing model: Cooperative-mediated supply chain finance and risk-sharing arrangement

Corporate partners leverage their sustainability commitments to co-fund a centralized pool of capital, managed by Soil Association Exchange - a UK measurement and finance facilitation organization - and Finance Earth - an enviormental impact fund manager - that pays farmers upfront and over time to adopt regenerative practices – without requiring the sale of carbon credits.

Applicability: Best suited to contexts where multiple corporates are willing to pool capital to collectively finance upstream agricultural emissions reductions and report Scope 3 benefits.

Considerations: Scalability depends on the continued willingness of corporates to contribute catalytic capital and on robust farm-level MRV systems capable of verifying practice changes and attributing emissions reductions reliably.

Description of de-risking tool(s):

Catalytic capital / Pooled fund structure: Corporate partners co-invest into a centralized fund managed by experienced intermediaries, de-risking individual farmer participation by providing upfront financial security and reducing reliance on carbon credit market price volatility

Case study description:

This model supports farmers across the UK in transitioning to regenerative practices – including reduced tillage, cover crops, and reduced fertilizer use. Rather than purchasing external carbon offsets, corporate partners contribute capital to a shared fund managed by Soil Association Exchange and Finance Earth, which directly finances the adoption of these practices on farms within their supply chains. Farmers receive upfront and ongoing payments to support the transition, without generating or selling carbon credits. Soil Association Exchange then verifies the resulting emissions reductions at a farm level, enabling participating companies to report lower Scope 3 emissions associated with their agricultural sourcing.

(1)  Corporate partners (Tesco, Lidl, Coop, Lloyds, Church Commissioners UK) provide funding to the Soil Association Exchange, pooling capital into a centralized fund managed jointly with Finance Earth

(2)  The centralized fund de-risks farmer practice change by providing financial security upfront, reducing the barrier to adoption of regenerative practices

(3)  Farmers receive payments upfront and over time in exchange for committing to specific practice changes (e.g., reduced tillage, no tillage, cover crops, reduced fertilizer use)

(4)  Monitoring and verification is conducted at farm level by Soil Association Exchange to assess practice change

(5)  Farmers are rewarded for verified practice changes (e.g., reduced tillage, no tillage, cover crops, reduced fertilizer use) 

(6)  Impact reporting (e.g., Scope 3 emissions reductions) and progress reporting are shared back with corporate partners, enabling them to report a reduction in their own Scope 3 emissions