BUSINESS
08/18/2016 03:14 pm ET Updated Aug 18, 2016

The Values Connecting Impact Investing and Organic Agriculture

Thomas Barwick via Getty Images

Iroquois Valley Farms Co-Founder and CEO, Dave Miller, makes it sound simple: “We built this company to support the businesses of our farmers.” Iroquois Valley Farms merges the worlds of socially responsible investing and organic farming to provide land access and financing to farmers interested in expanding their regenerative organic businesses. As a company dedicated to maximizing environmental and social returns in addition to economic returns, it made perfect sense to become a Certified B Corporation.

Organic farming operates differently from the conventional agriculture world. Therefore, a company built to support organic farmers must operate differently from conventional companies. As a Certified B Corp, Iroquois Valley Farms faces self-imposed standards of accountability and measures itself against a broader purpose. By implanting the Certified B Corp structure and pledging to be a business that benefits all while doing no harm, Iroquois Valley Farms embeds its mission to support organic farmers in its operating structure.

Organic farming involves long-term commitment to the land: it takes three years to transition soil from conventional to certified organic and our farmers say it takes over ten years to fully restore soil health to previously conventionally managed farms. The organic transition is rough – farmers must market their crops at conventional prices while putting in extra time and money on soil restoration, which often leads to operational losses. There is no immediate economic benefit to farmers doing the difficult work of transitioning the land to organic status. The reward comes over time, when farmers can finally sell into organic markets. Organic food is more popular and accessible than ever, yet farmers hoping to break into the market face minimal support. Iroquois Valley Farms not only aims to support transitioning farmers, but also indirectly increase the accessibility of organic foods to consumers. Simply, with more organic farmers there is more organic food.

It’s clear that consumers want more organic food – organic sales continue to grow and reached $43 billion in sales in 2015, according to the Organic Trade Association. In Iroquois Valley’s work and in the industry, millennials are driving change. 70% of Iroquois Valley’s tenants are millennial. Amazingly, less than 1% of total US cropland is organic, and organic food sales make up only about 5% of total food sales.

These limits also represent huge growth opportunities, but the transition period is a major barrier to change for farmers. Iroquois Valley Farms, as a Certified B Corporation is purposefully built to match the needs of organic farmers. In order to build a company to match the needs of a farmer, one must pass Farmer Psychology 101. The key principle is that farmers do not think in years, decades or lifetimes, but rather in generations. As such, Iroquois Valley Farms is structured as a leasing company that is able to hold the land for multiple generations if necessary. This leasing company approach differs from the traditional Wall Street trading model, in which assets are intentionally bought and sold regardless of their usage or their interaction with the asset holder. Conventional agriculture thrives in the Wall Street model that does not consider soil health or the vitality of the farming community. Iroquois Valley specifically contrasts this approach by offering indefinite land access that supports the farmer.

Second to generational access is the opportunity to take ownership. Our tenants become eligible to buy the land after seven years. While many farmers may never take ownership, providing that option is essential – it enables long-term decision-making and generational planning when combined with indefinite lease possibilities. As a Company we have only sold farmland to farmer tenants, never any third parties that would risk displacing the existing tenant. Again, this contrasts the Wall Street trading model that sells when it is optimal for the owner – not the tenant. We call this the “well, hopefully” approach—well, hopefully the farmer can buy when I want to sell the farm. The “well, hopefully” approach inherently supports conventional management by perpetuating uncertainty instead of supporting a generational perspective. By providing potential ownership options on the farmers’ terms, Iroquois Valley Farm directly supports organic regenerative agriculture and enables better farm management practices.

For Iroquois Valley Farms, becoming a Certified B Corp was a given. It was a clear and definitive way to demonstrate the Company’s commitment to the principles organic farming embodies. These principles of attentive care for the land and care for human health already operate on environmental and social bottom lines. Furthermore, organic agriculture generates more revenues for organic farmers, which enlivens rural economies. Essentially, organic farming as an industry exemplifies Certified B Corp values. It’s only fitting that a company dedicated to supporting organic farmers and helping them grow this movement aligns with the same ideals. Organic agriculture takes a clear stand on the issue of how to grow food and decides it can do it well; Iroquois Valley Farms goes a step further to ensure that an already mission-driven enterprise can and is doing better by and for the world.

Claire Mesesan can be reached via email at cmesesan@iroquoisvalleyfarms.com

The B Corp Life is a new blog series geared towards exploring what it’s like to work at a benefit corporation. Why do b corps matter, and what does the future hold for them? Let us know at PurposePlusProfit@huffingtonpost.com or by tweeting with #TheBCorpLife.

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