One of the great pleasures of running the Sustainable City Awards is judging the "Farsight" category for financial research.
The candidate papers are gleaned from the London Accord, which means they are always of high quality and cover a fascinating range of topics. This year was no exception.
The winner was a paper by CA Cheuvreux on the sustainability risks associated with luxury brands- human rights, conflict minerals, child labour, pollution, habitat destruction endangered species etc. It made for fascinating reading and demonstrated the soap bubble fragility of brand reputation.
However, I must confess the paper that got me thinking most was one from Deutsche Bank on the global trade in farmland.
This is a brilliantly written and accessible report which discusses the global land rush that is taking place for agricultural land. Much of this trade is driven by sovereign wealth funds (though some hedge funds are investing too) and concerns significant purchases of land in some of the poorest parts of Africa.
The Deutsche Bank report contains some startling numbers- for example over the last 12 years some 83 million hectares of land in developing countries – that is 1.7% of the world's agricultural area has been bought by foreign investors- notably from China, Brasil and India and by state owned companies from the middle-east.
Whilst it could be argued that foreign investment in African agriculture will bring much needed improvements in skills and infrastructure. This raises a number of troubling questions, especially when, according to Deutsche bank investment intended to enhance food exports are taking place in countries where malnutrition is common and there are issues with corruption and dysfunctional land registries.
This raises the very real prospect of destabilisation of the region driven by conflict arising from a failure of investors to respect the economic and social rights of local populations, to preserve environmental sustainability and to avoid one-sided agricultural development. This is especially apposite given that research points to a global rising in food prices being the trigger of the Arab Spring.
When one considers that this report has been produced, not by an NGO or aid organisation, but by a major international banking corporation, it makes me wonder whether we are sleep walking into a crisis.
