Firm to pitch $150 million Treenewable Climate Fund in GLF Dragons’ Den

Dragons' Den - GLF London 2016. GLF
Julie Mollins
11 May 2018

WASHINGTON (Landscape News) – An investment company managing almost $5 billion in land assets will make a $150 million pitch to venture capitalists and policymakers at a sustainable investment symposium in Washington this month in a bid to secure business financing and partnerships.

The International Woodland Company (IWC), which manages more than 4 million hectares, hopes to find financial backing for its 15-year Treenewable Climate Fund. The fund will invest in early forest value chain projects throughout sub-Saharan Africa, a region where 65 percent of land is degraded and 3 million hectares of forests are lost each year.

“One of the most effective ways to fight climate change is through new forest development and landscape restoration,” said Shauna Matkovich, sustainability manager at IWC, which has been in operation for 25 years. “Sub-Saharan Africa also presents an attractive investment proposition – growing demand for wood products, excellent tree growing conditions and available land.”

Through its Dragons’ Den pitch at the Global Landscapes Forum (GLF) Investment Case Symposium in Washington on May 30, the company aims to address current challenges related to the high costs of new forest establishment and land use resulting from a lack of private capital.

With 10 years experience working in sub-Saharan Africa, the company equates achieving profitable forest landscapes with best practices in forest management, a strong focus on environmental, social and governance and the support of cross-sectoral partnerships, Matkovich said in a video pre-released for the company’s Dragons’ Den pitch.

Through the Treenewable Climate Fund, IWC aims to attract private capital through cost reduction by securing multilateral funding and reducing risk through the application of an integrated forest landscape restoration model made up of partnerships with financers, governments and local stakeholders to manage a range of resources, Matkovich said.

At least two other projects valued between $5 million and $250 million – one featuring an Indonesian supply chain and another on fair ventures — will also be pitched onsite at the International Finance Corporation World Bank Group building in Washington and simultaneously broadcast online at 15:30 ET (20:30 GMT) on May 30.

BUILDING ON THE PAST

Dragons’ Den competitions at two previous GLF investment case symposiums led to the establishment of two other sustainability funds.

At the GLF investment symposium in Ordos, China in 2017, venture capitalists and policymakers rubberstamped the Land Degradation Neutrality (LDN) Fund, which aims to help fill a funding gap by investing $300 million in projects on land rehabilitation and sustainable land management worldwide. A first-of-its kind fund leveraging public resources to raise private capital, it was brokered by the U.N. Convention to Combat Desertification and is managed by the responsible investment firm Mirova.

Investments include enterprises in sustainable agriculture and livestock management, agro-forestry, sustainable forestry, renewable energy, infrastructure development and eco-tourism.

In 2015, the “dragons” gave the nod to the $10 million Tropical Landscapes Finance Facility in Indonesia, which announced its first major transaction this year — a $95 million sustainability bond  for a sustainable rubber plantation in a degraded Indonesian landscape.

PT Royal Lestari Utama (RLU), a joint venture between Barito Pacific, an Indonesian petrochemical company, and French tire maker Michelin is the first project to receive funds from the TLFF initiative, which was established by UN Environment, the World Agroforestry Centre (ICRAF), ADM Capital and BNP Paribas at the GLF investment symposium in London.

ALIGNING INVESTMENT

In light of concerns over climate change-related risks caused by land degradation and land availability, GLF Dragons’ Den pitches are indicative of a trend among companies on the lookout for new ways to extract natural resources or plant farmland while maintaining or restoring healthy landscapes.

These companies are now developing creative ways to gain even bigger profits by making land pay out more than once – and keep on paying indefinitely.

Land resources with available infrastructure are limited, posing a significant challenge to investors and requiring that land use occurs within the currently available footprint, rather than degrading new forest areas.

More than 250 financial experts, policymakers and environmentalists will be in attendance on site in the symposium in Washington to discuss the challenge of funding the restoration of more than 2 billion hectares of degraded land worldwide, a footprint larger than South America. Thousands more will watch online.

Overall, land degradation is estimated to cost the global economy as much as $4.5 trillion a year, while benefits of restoration are an estimated $84 billion a year, according to a 2017 research paper published in Environmental Research Letters, and statistics from World Resources Institute.

At least 7 million hectares of tropical forest landscapes are cleared and degraded each year, putting livelihoods, biodiversity, and food security at risk, exacerbating climate change, conflict and human migration.

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