This project concept has been prepared for the Adaptation Fund

Roots of Resilience

Scaling Impact Through Market Integration and Innovation

The project aims to enhance the resilience and adaptive capacity of vulnerable farmers, industries, and communities engaged in perennial plantations and small-scale agroforestry by developing demand-driven climate information services, adaptation solutions, and financial strategies to support planning for climate variability, climate change, and extreme weather events.

Implementing Partners

Background

Mitigation and delivery of global net zero ambitions are significantly behind schedule, leading to more dangerous climate change and increased risks for countries and communities, particularly for those with limited capacity to cope with extreme climate threats

It is crucial to prioritize climate adaptation by strengthening the narrative around managing climate risks and adopting climate-smart practices, especially in agriculture and the environment.

The gap between the adoption of effective measures and necessary industry uptake is widening. This highlights the need for planned adaptation, incorporating both incremental and transformational strategies through integrated efforts involving communities and government.

While adaptation remains a priority, there may come a time when the costs of adaptation outweigh its benefits. In such cases, risk transfer solutions like insurance may be more prudent.

Therefore, to ensure resilient production systems, developing tailored approaches that combine risk management and risk transfer is essential.

The gap between effective climate-risk management measures and industry adoption is widening as climate change accelerates

Target Area

The proposed project will be implemented in the Southeast Asia region, potentially in Vietnam, Cambodia, Laos, Indonesia, Papua New Guinea, Timor-Leste, and the Philippines. These countries are highly vulnerable to climatic variations and changes.

The industry-led project — which includes farmers, agribusinesses, supply chain participants, farmer organizations, and the farming community — will focus on perennial plantation and small-scale agroforestry, systems, which are highly vulnerable to climate variations and have limited options for adaptation. Importantly, increased involvement from industry stakeholders through co-innovation processes will empower these stakeholders to take ownership in developing more tailored, market-driven adaptation and risk transfer solutions.

Importantly, the project will assist governments in implementing NAPs, particularly emphasizing the need for both community-led and government-led adaptation programs. This is especially relevant for the perennial plantation and small-scale forestry sectors, which often receive insufficient government attention.

Focus production systems

The project will focus on the perennial plantation systems and small-scale agroforestry systems. The perennial production systems include:

- Coffee

- Cocoa, and

- Cashew nut

Overall Aim

The goal of the project is to enhance the resilience and adaptive capacity of vulnerable farmers, industries, and communities (including women, ethnic communities, and other marginalised groups) engaged in perennial plantations and small-scale agroforestry by developing demand-driven climate information services, adaptation solutions, and financial strategies to support planning for climate variability, climate change, and extreme weather events.

Objectives

Develop accurate, demand-driven climate information and bespoke risk assessments (and tools) tailored to specific industries (coffee, cocoa, and cashew nut, and small-scale agroforestry systems) and regions, effectively addressing climate risk management needs, supporting market-driven adaptation and financial solutions, and facilitating regional and National Adaptation Plans (NAPs).

Develop and pilot market-driven co-investment/financing adaptation plans and policy advice that are regional and industry-focused (coffee, cocoa, and cashew nut, and small-scale agroforestry systems), knowledge-driven, and location-specific, addressing adaptation deficits while considering both incremental and transformative adaptation strategies.

Enhance and strengthen industry-wide sustainability programs, such as traceability systems, to improve climate mitigation (e.g., GHG emission) and climate adaptation strategies.

Explore alternative risk management solutions that utilise industry-led (coffee, cocoa, and cashew nut, and small-scale agroforestry systems) co-investment models for insurance premiums, as well as business and consumer payment approaches, and regional or industry-wide insurance risk pooling mechanisms.

Develop structured awareness-raising and capacity-building practice change management programs for farmers, communities, industry and regional climate information providers. Importantly, work with industry to include adaptation and adaptation planning outcomes into existing extensions and capacity building programs such that they are tailored to the local context and other risks.

Access to skilled, reliable, industry-targeted climate information is essential for effectively managing climate risks and benefiting from opportunities when conditions are favourable

Project Outputs

Research studies focused on demand-driven climate products tailored for coffee, cocoa, and cashew nut, as well as small-scale agroforestry systems and accessible climate datasets, integrated into a customised risk management framework, along with industry-wide and regional climate information platforms and early warning systems to inform improved decision-making.

Improved assessment of multi-hazard risks, vulnerabilities, and impacts, leading to the development of evidence-based, market-driven co-investment adaptation plans and policy advice tailored to specific industries (coffee, cocoa, and cashew nut, and small-scale agroforestry systems) and regions, as well as contributions to National Adaptation Plans (NAPs).

Enhanced industry-specific traceability frameworks and sustainability programs driven by consumer and market incentives to improve management practices and adaptation strategies, and tailored tools for the industry and banks to assess the environmental impact and effectiveness of their traceability programs.

Enhanced, cost-effective, demand-driven insurance solutions and sustainable industry-led insurance scaling programs, leveraging proven sustainability initiatives based on co-investment and consumer pay approaches.

Climate information services informed by industry and regional users; training materials for culturally-informed awareness-raising specific to industries; programs and materials for inclusive (gender-inclusive) workshops and field days; digital advisory services utilising digital platforms and social media networks.

Project Outcomes

Improved availability and accessibility of climate information meets the climate risk decision-making needs of industry and regional stakeholders in the coffee, cocoa, cashew nut, and small-scale agroforestry sectors, as well as national/regional hydro-meteorological services on climate risk management, significantly builds industry and regional capacity and supports the implementation of NAPs

A deeper understanding of climate related losses affecting perennial plantation systems, such as coffee, cocoa, and cashew nuts, and small-scale agroforestry, has led to the development of tailored, market-driven co-invest/financed incremental and transformative adaptation plans and, importantly, avoided maladaptation. The upscaling plans embedded in the project have significantly enhanced the resilience and adaptive capacity of both perennial plantation systems and small-scale agroforestry, benefiting the communities and regions that depend on them in the face of climate variability and change.

Significantly improved synergies between mitigation and adaptation have led to reduced environmental footprints, such as lower greenhouse gas emissions and improved ecosystem health, due to the establishment of improved frameworks for traceability systems and the expansion and strengthening of industry-wide sustainability initiatives.

Improved financial resilience through more sustainable insurance programs has been adopted at the industry and or regional levels, particularly those based on a more sustainable business/user pay approach that does not require subsidies. Importantly, financial institutions, including banks and insurers, have increased capacity to integrate climate risk and traceability aspects into their products and services, improving their support for perennial plantation production systems and supply chains.

A skilled and adaptable workforce capable of harnessing data to make effective decisions where industry, farmers, and institutions (such as National Hydrology and Meteorological agencies) have enhanced awareness and capacities regarding climate products, the importance of adaptation strategies, and the use of insurance as a risk management tool for farm businesses

Perennial plantation systems are particularly vulnerable to climate variability and change, with limited adaptation options due to their long lifespan and high investment costs