Root Capital invests nearly $100 million toward climate resilience globally in 2022
Root Capital, a nonprofit that supports the growth of agricultural enterprises in Africa, Latin America, and Indonesia, has deployed $239 million since 2020 to help rural communities invest in urgent climate action
Cambridge, MA, April 24, 2023 – Today, Root Capital announced nearly $100 million in climate financing disbursed in 2022, part of its Climate Resilience Roadmap, a six-year strategy to build the climate resilience of agricultural enterprises and smallholder farmers. This climate financing builds upon almost $140 million disbursed in 2020-2021 to help farming communities around the world invest in climate action, including reforestation projects, regenerative agroforestry farms, or the production of climate-ready crops like sorghum.
Approximately 95% of the world’s farms are small-scale, yet the sector only receives 1.7% of global climate financing. Root Capital’s research shows that there is significant demand for climate action investment among agricultural enterprises; however, lack of financing remains a barrier. To help close this financing gap, the organization is developing and testing climate loans and grants that meet the needs of smallholder agricultural businesses and farmers. Over the next three years, Root Capital will continue to increase climate financing in its own portfolio and will exchange lessons with other impact investors to collectively scale up climate finance for the agricultural sector.
“Root Capital’s Climate Resilience Roadmap launched in 2020 as a response to the existential threat posed by climate change to agricultural communities around the globe,” said Willy Foote, Founder and CEO of Root Capital. “We know it’s impossible to achieve our mission of rural prosperity without addressing the climate crisis. With the right support, rural communities that are most vulnerable to climate impacts can be powerful champions of climate action. To that end, we equip agricultural enterprises with the information, management skills, and capital needed to spark and sustain climate action at scale, and to ensure they're a climate vanguard, not climate victims. I’m proud of the innovative solutions we’ve developed and implemented together over the last three years.”
In 2022, Root Capital piloted five new climate finance loans in Central America and East Africa, disbursing $445,000 to help businesses invest in soil regeneration and renewable energy. They also awarded $286,000 in grant funding to help 16 businesses across Africa and Latin America defray the upfront costs of new investments in climate adaptation.
“Halfway through our six-year strategy, Root Capital has made significant progress against our goals and generated valuable insights about how best to support small and growing agricultural enterprises to ramp up climate action,” said Elizabeth Teague, Director of Root Capital’s Climate Resilience Initiative. “While this is a promising start, we recognize our climate loans and grants to date represent a first step toward closing the enormous financing gap, and we look forward to working with partners to collectively scale climate finance for agriculture.”
View Root Capital’s 2022 Climate Resilience Roadmap report here.
The report is also available in Spanish here.
- To speak to a Root Capital climate investing expert about these findings, please contact Kristin Williams at firstname.lastname@example.org or 617-794-4525.