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Co-design of novel contract models for innovative agri-environmental-climate measures and for valorisation of environmental public goods

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Incentivising farmers to adopt greener agriculture

Agriculture’s benefits to the environment can be increased if current practices are transformed. The EU-funded Contracts2.0 developed a series of farming approaches that balance productivity with sustainability.

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An evolution in agriculture could help mitigate the impacts of two major ongoing crises: climate change and the decline of biodiversity. Currently, farmers can participate in agroecology and climate schemes, and receive financial compensation for efforts to carry out conservation measures on their land. However, effective implementation and monitoring of these schemes can be complex, which is hampering their wide adoption by farmers across the EU. “Current schemes are often inflexible and do not consider the reality of geographical differences,” explains Bettina Matzdorf, social scientist at the Leibniz Centre for Agricultural Landscape Research, and project coordinator of Contracts2.0 (Co-design of novel contract models for innovative agri-environmental-climate measures and for valorisation of environmental public goods). She adds: “Novel contracts that offer payments by results, that foster the collaboration of farmers, could better incentivise them to produce not only agricultural products but also biodiversity and other ecosystem services.”

Landscape-scale solutions

The EU-funded Contracts2.0 project developed innovative approaches to make these schemes more effective and enticing to farmers. The overall idea was to incentivise farmers to produce more environmental public goods: non-exclusive, non-expendable products such as attractive landscapes. The Contracts2.0 team wanted to find out which contract models enhance the provision of such environmental public goods, while at the same time enabling economically viable agricultural production. “The solutions to many of our biodiversity, water and climate goals need to be delivered at the landscape scale,” says Matzdorf. To find which approaches might work best, the team examined a range of results-based and collective agri-environmental climate schemes. They also considered land tenure approaches, as well as looking further down the value chain at ideas such as private payment schemes based on certificates. “We analysed existing examples around Europe, tested new contract designs within economic experiments, and co-developed solutions on the ground,” Matzdorf notes. The team also researched the necessary policy framework conditions for implementing new schemes in nine different EU countries.

Creating innovation in the field and online

The Contracts2.0 project created 11 contract innovation labs across Europe, bringing together farmers, scientists and environmental experts to develop new, feasible solutions that could be placed into contracts. These were complemented by policy labs, which brought policymakers in particular to the table to develop appropriate policy frameworks. Beginning in 2019, the team held a series of field trips, to encourage the exchange of knowledge, demonstrate best practice examples, and make the approaches and goals tangible. “Practitioners emphasised the importance of learning from each other. The trips facilitated the exchange between stakeholders from different labs, but we also participated as researchers,” says Matzdorf. During the pandemic the team had to replace in-person workshops with ‘virtual’ events on agro-eco themes. The online format, free access and invited experts facilitated the great success of the workshops.

The future of sustainable food

Matzdorf highlights that the collaboration between farming practice, policy and science in many European countries, meant that a vast variety of circumstances, farming types, landscapes and policy environments were considered. “I do think we have been able to move some pebbles in the river towards better contracts for agriculture and nature,” she remarks. The project also produced a catalogue of factors facilitating and hindering existing approaches, and a guideline for policy framework fostering contract-based approaches and the development of appropriate agri-environmental-climate policies.


Contracts2.0, agriculture, agroecology, environmental, goods, farming, practices, sustainable, food, biodiversity, water, landscape

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