Green Finance: a tool for assessing the environmental impacts of investments in livestock farming

As part of the development of green financing for agriculture, we propose a tool for assessing the environmental impacts of farm investments. This tool could allow stakeholders (bankers and investors) to allocate loans according to the ‘green' nature of equipment. The work presented here considers specialised dairy and pig farms but also works for crop farming. The impacts of farm equipment were assessed through the impacts of agricultural practices they allow to implement. Firstly, each practice was evaluated for eight environmental performances: soil quality, water quality, air quality, greenhouse gas emissions, energy consumption, water consumption, biodiversity and animal welfare. The notation associated to each performance was based on a qualitative five level scale corresponding to a strongly negative, negative, neutral, positive or strongly positive impact. The practices dealt with feeding and forage production, manure management, housing, herd management, milking, biodiversity management and resource use. Their impacts were evaluated based on scientific literature and expert judgement. Secondly, the pieces of equipment required to implement these practices were listed, resulting in 157 pieces of equipment for dairy farming and 91 for pig farming. When a piece of equipment was used to implement a single practice, it received the grade of the practice; when several pieces of equipment could be used to implement different practices, their impacts were evaluated through the mean value of practice impacts. The final databases gather 162 practices for dairy farming, 72 for pig farming and 248 pieces of equipment evaluated for the eight performances. When a practice or a piece of equipment has both positive and negative environmental impacts, we explain the antagonisms and identify the means of mitigating the most negative impacts.