In early 2014, The Rockefeller Foundation President Judith Rodin and my former colleague Margot Brandenburg released a new book on the power of impact investing. Impact investing—investment dollars designed to deliver both financial and social or environmental returns—provides investors with a compass for shared prosperity. It shows the power of double bottom line investments, where a social gain is delivered and the investor earns a worthwhile return.
A similar approach to investing can be applied with potentially transformative results to oceans and fisheries management. With better investment strategies and simple changes in fishing practices and management, we could provide immense opportunities for returns on investment while improving the livelihoods of small-scale fishers and delivering a more reliable product for consumers.
Managing fisheries better
The core idea here is simple—better managed fisheries are more profitable than poorly managed ones—and so there is potential to make money by putting in place the management measures that allow fish stocks to rebound. To unlock this potential, we need to learn from what has been done in other sectors, innovate and test ideas with some risk capital, and mobilize a good dose of a global ambition.
With good reason, there is a tendency to be pessimistic about the challenges and opportunities ahead for the fisheries sector. Too many people are chasing too few fish, and globally more than 80 percent of fisheries are over-fished or on the verge of collapse. The pressure on wild fish stocks is mounting as demand for fish continues to rise. Climate change adds a layer of uncertainty to the future of our oceans and their related resources.
Despite these daunting challenges, we are already seeing positive changes, including the increasing involvement of the private sector in advancing models for sustainable seafood production. We’re seeing seafood buyers and retailers get involved with fisher groups to make sure that the fisheries where they source their product are well managed. We’re seeing them invest time and resources in improving conditions in poorly managed fisheries through Fishery Improvement Partnerships, which are growing in number and coverage across the globe.
Saving our oceans has gone from being mostly a public policy-focused endeavor to a collaboration between private and public actors who derive shared value from improved fisheries management. Indeed, this new wave of interest and non-traditional alliances is part of what has piqued The Rockefeller Foundation’s interest in this area, leading to an exploration of new approaches to unite the actors who will benefit from improved fisheries—impact investors, seafood retailers, seafood processors, government regulators, and fishers—to make the urgent changes needed to revitalize small scale fisheries.
Already, new forms of investments are emerging that will help unlock opportunities for better fisheries management and shared value creation. EKO Asset Management Partners, with support from The Rockefeller Foundation, Bloomberg Philanthropies, and in cooperation with Oceana and Rare, has proposed three mechanisms that could help change the future of fisheries. These include:
- A microfinance/small and medium- enterprise route-to-market vehicle, which targets improved processing and distribution logistics to increase the sourcing of sustainable seafood in developing countries. This mechanism gives local fishers the opportunity to benefit from the success of this model.
- A public-private partnership vehicle whereby investors fund private partners to deliver a number of data, enforcement, management, and assessment services that support sustainable fishing practices and increased employment in the fisheries sector.
- A pay-for-performance impact vehicle. This would fund interventions targeted at specific seafood production systems, providing long-term supply contracts that alleviate the burden of risk borne by fishers in exchange for measures that improve the management of the fishery.
The unique added value of these strategies is that everyone involved in the partnership is a winner: the marine ecosystems, fisheries communities, investors, and consumers. All will benefit from the improvements made to fisheries, and the subsequent increased fishing efficiency and resilience of the resource. These mechanisms will be further developed in the Philippines, Chile, and Brazil, and, if promising, will be tested further by market actors.
The growth of the impact investing field has proven that there is an appetite among investors for these kinds of social and environmental investments. These financing tools might satiate this hunger while propelling fisheries toward a sustainable future.