Is there a war being waged on farmers across the globe in the name of going green?
In March, the Securities and Exchange Commission (SEC) proposed a new environmental, social, and governance (ESG) rule that mandates small farms disclose climate-related information if they wish to do business with public companies. The proposed rule, titled “Enhanced and Standardization of Climate-Related Disclosures for Investors,” would require registrants to share specific “information about climate-related risks that are reasonably likely to have a material impact on their business, results of operations, or financial condition.”
Put simply, farmers and ranchers would need to allocate substantial resources and significant time to track environmental data.
“I am pleased to support today’s proposal because, if adopted, it would provide investors with consistent, comparable, and decision-useful information for making their investment decisions,” SEC Chairman Gary Gensler said in a statement. “I believe the SEC has a role to play when there’s this level of demand for consistent and comparable information that may affect financial performance. Today’s proposal thus is driven by the needs of investors and issuers.”
Critics contend that the recommendation would potentially block farmers from working with public firms since these outfits don’t possess compliance resources and departments like large corporations.
More than 100 Republican and Democratic House members sent a letter (pdf) to Gensler, accusing the SEC of having “overstepped its bounds” and that the proposed rule would result in “devastating effects on our farmers.”
Securities and Exchange Commission Chair Gary Gensler listens during a meeting at the U.S. Treasury Department in Washington on Oct. 3, 2022. Anna Moneymaker/Getty Images
“Not only would this proposal add additional red tape and bureaucracy that would be extremely burdensome, if not impossible, for many public companies to fully comply with, but it would also far exceed the authority that Congress explicitly granted the SEC,” the lawmakers stated.
The American Farm Bureau Federation also submitted a letter (pdf) rejecting the SEC’s efforts.
“Bureaucrats in Washington, D.C.—specifically, unelected SEC staff—who have no jurisdiction over environmental policy and who have never stepped foot on a farm should not have such influence over how farmers take care of their land,” the letter said. “The time and energy put into complying with this new regulation will divert American farmers away from their primary goal of producing our nation’s food, fuel, and fiber.”
Ultimately, lawmakers and groups are asking that the SEC scrap the proposed rule altogether.
Experts suggest that the SEC may be unable to pass this rule as the courts have previously ruled against government agencies in forcing the disclosure of sensitive personal information. However, the Harvard Law School Forum on Corporate Governance concluded that the proposal falls within the SEC’s authority.
“So, instead, like a cuckoo putting its eggs into another’s nest, critics have resorted to mischaracterizing the proposal, and inventing their own, fictional rule—not actually proposed—to attack premise two, and claim the Commission lacks authority for their fictional new rule,” wrote John C. Coates, a professor of law and economics at Harvard Law School.
Regardless, this might not be the last measure employed by the government to advance the ESG cause, says Irina Tsukerman, a geopolitical analyst at the media and strategic advisory firm Scarab Rising.
“ESG standards have been affecting U.S. agriculture for a number of years now,” she told The Epoch Times. “The bans on the production and sale of foie gras in New York and other states is but one example.”
According to Tsukerman, this type of policy would financially and legally destroy farmers as they would need to maintain environmentally conscious policies, which are “likely to drive them out of the business.”
“The ESG movement in the farming industry disproportionally favors Big Farm, stifles competition, and creates a ‘woke’ corporate agricultural monopoly, which leads to fewer options for the consumers,” she added.
The SEC is expected to make a final decision in early 2023.
But imposing socially responsible guidelines on the agriculture sector isn’t only happening in the United States. It’s transpiring worldwide.
A Global War on Farming?
A growing number of nations across the globe are embracing the green agenda for farmers.During an Independence Day speech in August, for example, Indian Prime Minister Narendra Modi pushed for organic and natural farming, calling the adoption of chemical-free farming the nation’s “duty.”
“Today natural farming is a path to Atma Nirbharta. Natural farming, chemical-free farming can add to the strength of our country. Natural farming can bring down fertilizer costs. Chemical-free farming and organic farming is our duty,” Modi said.
In September, the European Commission approved the Common Agricultural Policy (CAP) that aims to bolster green farming, achieve green and biodiversity objectives, and enhance plant protein initiatives. The latest CAP goals are set for 2023 to 2027, and several countries have signed off on the latest packages, including Denmark, France, Portugal, and Spain.
“Farmers are facing a challenging environment, marked by the sharp increase in production costs due to the Russian aggression in Ukraine, as well as the recent summer drought. Farming is a long-term business, and European farmers need to have a clear legal and financial framework for the future,” says Agriculture Commissioner Janusz Wojciechowski. “The new CAP will help us to support stable farming livelihoods and long-term food security by fostering a smart, competitive, resilient, and diversified agricultural sector.”
Since 2016, the United Nations Conference on Trade and Development (UNCTD) has been pushing for the widespread implementation of green agricultural policies in Africa, arguing that the continent has “rich potential” and only needs funding to move ahead with organic farming.
“In view of the current situation, we strongly advocate for a coordinated effort to improve the data collected about both the domestic and export value of organic products so that a better business case for organic agriculture can be made in Africa,” the UNCTD wrote in a technical paper.
Last year, the Canadian government announced more than $500 million in new investments to expand the domestic agriculture industry’s campaign for sustainability and climate change solutions. Part of these efforts involves providing farmers with tools, resources, support, and knowledge to increase organic farming production.
“As consumer interest in organic food continues to grow, we need to ensure that our farmers have the knowledge and skills to meet that increasing demand,” said Agriculture Minister Marie-Claude Bibeau. “This investment will help grow the Canadian organic agriculture sector and address market demands by providing support to farmers who want to incorporate more organic farming techniques in their operations.”
Canada’s organic farming sector is presently estimated to be worth $8 billion, the sixth largest market in the world.
