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AGRICULTURE CAPITAL (ACM Management Company, LLC)

PRI reporting framework 2020

You are in Strategy and Governance » Objectives and strategies

Objectives and strategies

SG 05. RI goals and objectives

05.1. Indicate if and how frequently your organisation sets and reviews objectives for its responsible investment activities.

05.2. Additional information. [Optional]

We incorporate this review into our quarterly asset evaluation process and the ongoing process we have of seeking compliance with formal performance guidelines related to responsible business and investment. All senior personnel are involved in the review of asset activities and performance.


SG 06. Main goals/objectives this year

06.1. List the main responsible investment objectives that your organisation set for the reporting year.

Responsible investment processes

Key performance indicator

          We built and actively manage a tiered system for integrating of ESG expectations and leadership into our operation called The AC Way.
        

Progress achieved

All assets are baselined either during diligence or during the first year of operations.Currently, all AC assets meet thebaseline Tier 1 standard. We were managing toward a goal of Tier 3 (out of 5) status for all assets by the end of 2019 and were generally successful. We have set Tier 5 expectations for several assets in 2020 and expect the results from that process inform our 2021 portfolio-wide goals.

Key performance indicator

          Each asset reports on AC Way progress each quarter, with cascading goals designed to reach all operators.
        

Progress achieved

This reporting and cascading goal setting was operationalized in 2019 and has informed 2020 budgets and performance goals.

Key performance indicator

          Each asset reports on AC Way progress each quarter, with cascading goals designed to reach all operators.
        

Progress achieved

This reporting and cascading goal setting was operationalized in 2019 and has informed 2020 budgets and performance goals. The AC Way incentivizes action across the evaluation framework designed to reach beyond incremental improvement.

Key performance indicator

          Deal flow and investment team work flow are designed to incorporate AC Way baselining.
        

Progress achieved

All assets currently under management have been baselined, either during the investment process or in year one of operations, using our AC Way framework.

Financial performance of investments

Key performance indicator

          We are seeking ESG-related alpha on several priority projects
        

Progress achieved

Longitudinal data being collected and compiled

ESG characteristics of investments

Key performance indicator

          ESG-related diligence checklist completed for each investment consideration
        

Progress achieved

All assets currently under management have been baselined, either during the investment process or in year one of operations, using our AC Way framework.

Other activities

Key performance indicator

          Increase and deepen targeted RI initiative engagement
        

Progress achieved

We are active participants in several key networks and have cultivated a growing reputation in the conservation finance realm.

Key performance indicator

          Continue to be a vocal supporter of high-value RI initiatives
        

Progress achieved

We are active participants in several key networks and have cultivated a growing reputation in the conservation finance realm.

Key performance indicator

          Develop new partnerships to facilitate case study communication
        

Progress achieved

We are active participants in several key networks and have cultivated a growing reputation in the conservation finance realm. We have ongoing projects with several academic and civil society organizations.

Key performance indicator

          Report actively to key stakeholders on illustrative case studies
        

Progress achieved

We are active participants in several key networks and have cultivated a growing reputation in the conservation finance realm. We have ongoing projects with several academic and civil society organizations.

06.2. Additional information.

We consider the diverse experiences and perspectives of people across our organization to be an extraordinary source of creativity that can drive results for our
businesses. Those experiences have led to improved efficiencies, increased productivity, and safer and more responsible operations. Our focus is to empower our teams—in geographies they understand best, in operations they steward every day—to make the most thoughtful decisions they can make, rooted in the solid foundation of our mission and core values. We recruit with intention to assemble teams that are best equipped to represent our purpose.

That said, we have recognized that this effort is inherently collaborative. That is why we utilize a process and framework that we call “The AC Way” to align leadership and risk management on environmental, social, and governance factors with business performance. The core management factors within the AC Way have been compiled from our evaluation of existing industry performance standards that encapsulate a broad range of actions that cover material aspects of our operations. The framework includes standards in areas as far-reaching as workplace quality, pest control, water stewardship, waste handling and recovery, chemical management, packaging, landscape ecology and habitat quality, energy efficiency, and climate protection.

The AC Way is a tiered system, designed to drive improved performance over time. Our expectation is that every investment we pursue meets a baseline Tier 1, or first stage, performance. That minimum expectation provides assurance across a discrete set of core business indicators that our ability to optimize the asset for efficiency and impact is achievable. From there we work closely with our asset managers to drive performance toward Tier 5, which we believe differentiates our assets significantly from others in the marketplace. In some cases, that high-level performance focuses on improving or refining operational procedures.

In other cases, it involves transformative step changes. In all cases, this program is aligned with our operational planning, progress assessment, and budgeting.
As the program expands, we intend to use it as a goal-setting framework for our asset managers and for our business as a whole. We also expect to further adapt the AC Way to capture evolving factors of particular interest to us in our efforts to make our regenerative management efforts increasingly concrete and effective.


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