Investing in supply chain resilience

Reducing investment risk and unlocking capital for high-impact initiatives is not just a financial strategy, it's a pathway to climate resilience, economic empowerment, and sustainable land use. 

Across emerging markets, there is growing momentum to invest in solutions that protect forests, promote responsible land use, and empower smallholder farmers through sustainable and inclusive agriculture. Blended finance is proving to be a powerful catalyst, unlocking private capital and accelerating investment into impact initiatives.  

IDH is working to shift the investment paradigm by convening coalitions, enabling strategies that reduce investment risk and aligning capital with purpose. 

Too often, investment flows follow capital availability rather than purpose. But what if we started from a shared vision of the impact we seek, and aligned the right forms of capital to realise it? 

When it comes to smallholder farmers in emerging markets, the investment opportunity extends far beyond direct lending. It’s about financing the full ecosystem around them: infrastructure, services, value chains, and the enabling conditions that allows farmers to build climate resilience and increase incomes. This is where systemic investment approaches through Strategic Capital Orchestration can make the difference. 

At the centre of this approach are Financial Backbones. To convene coalitions, align different types of capital, and ensure that investment flows are strategic rather than fragmented. This thinking is explored in a new publication from the TransCap Initiative, co-authored with 27 members of the TransCap Community, including Barbara Visser from IDH Invest. 

For many smallholder farmers, and the small- to medium-sized agribusinesses that serve them, limited access to finance is one of the largest barriers to success. Though smallholder farmers make up over 80 percent of the world’s farms, investors often perceive the sector as risky with insufficient returns. 

With only 1,7% of climate finance reaching smallholders, it's clear we need to rethink how and where capital flows. 

In this article, ISF Advisors, Acumen and IDH share 5 key lessons for unlocking capital that works for farmers, agri-SMEs, and food systems. 

After six years of hands-on investment and collaboration, the Land Degradation Neutrality Fund and its Technical Assistance Facility share practical lessons from financing sustainable land management projects in complex, high-risk markets. From leveraging public and private financing to working with local developers, these insights offer a blueprint for building more resilient, high-impact investment strategies in sustainable land use.