Terre Agricole Italiane is the reserved real estate AIF established and promoted by Gardant Investor SGR.
An innovative solution that meet the current needs of the market, dedicated to the investment in agricultural land and real estate property connected to the agriculture business, mainly located in Italy and other EU member states, in order to support the real economy and actively contribute to the development and relaunch of the agri-food sector, an essential infrastructure for our country. An investment proposal taking into consideration sustainability issues (in line with the provisions of Article 8 of EU Regulation EU 2019/2088, thus promoting ESG characteristics), aimed at supporting the process of evolution, transition and growth of Italian agriculture.
The Fund has a target of 200/300 million Euros.
PERIODIC DISCLOSURE FOR FINANCIAL PRODUCTS UNDER ARTICLE 8 OF REGULATION (EU) 2019/2088 AS OF DECEMBER 31, 2024
Sustainability-related disclosures
a) Summary
The Fund Terre Agricole Italiane is classified as a financial product that, according to Article 8 of Regulation (EU) 2019/2088 (also known as “SFDR”), promotes both environmental and social characteristics.
In line with the most recent European regulations, Gardant Investor SGR adopts activities and processes to ensure the correct implementation of the legislation. This process involves integrating ESG criteria into its processes and behaviors. Gardant Investor SGR aims to monitor and manage the risks associated with sustainability factors that investments may pose to investors and counterparts. The Company also commits to transparently communicate its approach to integrating sustainability factors into investments, especially concerning the evaluation and management of ESG risks, through channels specified by current regulations.
Within the risk management system, sustainability risk management related to the Fund’s investments focuses on identifying, assessing, and monitoring parameters related to environmental and social characteristics promoted by the product through a proprietary tool.
In general, regarding investment decisions, technical, environmental, and legal due diligence is conducted by professional entities. Additionally, these analyses are considered by the Risk Management function. Environmental and social risk factors are understood as events or environmental, social, or governance conditions that, in case of occurrence, could cause a material actual or potential negative impact on the value of an investment and, therefore, on the Fund. No benchmark has been identified that meets the environmental or social characteristics promoted by the Fund.
Specifically, the environmental characteristics promoted by the Fund Terre Agricole Italiane include:
- Supporting the use of organic, regenerative, and conservation agriculture techniques;
- Limiting chemical contamination of soil, groundwater, and air by reducing the use of chemical fertilizers and pesticides;
- Promoting organic farming and limiting the use of artificial fertilizers, herbicides, and pesticides;
- Encouraging crop rotation to stimulate greater landscape and ecological variability, reducing the persistence of ecosystem disservices such as pest outbreaks;
- Reducing greenhouse gas emissions from the agricultural sector by promoting the use and production of energy from renewable sources;
- Supporting the modernization of the agricultural sector through the use of agriculture 4.0 techniques and technologies to reduce emissions from agricultural vehicles, the use of pesticides, and water consumption;
- Promoting the use of precision farming technologies that allow for the reduction of natural resource consumption and the increase in the quality and quantity of production.
The Fund Terre Agricole Italiane promotes the environmental objective listed in Article 9(f) of Regulation (EU) 2020/852, “protection and restoration of biodiversity and ecosystems,” but it does not make sustainable investments that consider EU criteria for environmentally sustainable economic activities and, therefore, does not contribute to the environmental objectives listed in Article 9 of Regulation (EU) 2020/852.
The social characteristics promoted by the product include:
- Increasing employment, especially of young farmers;
- Facilitating agricultural entrepreneurship, particularly among the youth;
- Increasing the presence of young and/or female employees in the agricultural sector;
- Promoting the participation of agricultural operators, even in rural areas;
- Promoting knowledge transfer and innovation in the agricultural sector, including in rural areas;
- Strengthening agricultural income and stimulating competitiveness.
Specific clauses will be included in the lease contracts to monitor the above-mentioned environmental and social characteristics. Indicators of sustainability used to measure the environmental or social characteristics promoted by the product are:
- Hectares of land subject to crop rotation;
- Percentage of assets allocated to projects of organic and/or regenerative and/or conservation agriculture out of the total allocated assets;
- Percentage of assets allocated to agricultural projects using precision farming techniques out of the total allocated assets;
- Percentage of assets allocated to agricultural enterprises with environmental certifications out of the total allocated assets;
- Percentage of assets allocated for the modernization of agricultural techniques and tools out of the total allocated assets;
- Number of farmers under the age of 41 with experience receiving aid for first settlement in a farm as the head of the farm;
- Number of farmers under the age of 35 with a degree receiving aid to start their own entrepreneurial initiative in agriculture;
- Number of agricultural businesses organized as sole proprietorships or companies, composed of young people aged between 18 and under 41 or women;
- Number of farmers who have benefited from training/information actions;
- Number of farmers under the age of 41 hired;
- Percentage of assets allocated to increase profitability per hectare of cultivated land out of the total allocated assets;
- Percentage of assets allocated to agricultural projects in rural areas and/or subject to natural constraints out of the total allocated assets;
- Number of farmers operating in rural areas who have benefited from training/information actions.
b) No sustainable investment objective
This financial product promotes environmental and social characteristics but does not have sustainable investment as its objective.
c) Environmental or social characteristics of the financial product
The environmental characteristics promoted by the Terre Agricole Italiane Fund include:
- Supporting the use of organic, regenerative, and conservation agriculture techniques.
- Limiting chemical contamination of the soil, groundwater, and air by reducing the use of chemical fertilizers and pesticides.
- Promoting organic farming and limiting the use of artificial fertilizers, herbicides, and pesticides.
- Encouraging crop rotation to stimulate greater landscape and ecological variability, reducing the persistence of ecosystem disservices such as pest outbreaks.
- Reducing greenhouse gas emissions from the agricultural sector by promoting the use and production of energy from renewable sources.
- Supporting the modernization of the agricultural sector through the use of 4.0 agriculture techniques and technologies to reduce emissions from agricultural machinery, pesticide use, and water consumption.
- Promoting the use of precision farming technologies that enable the reduction of natural resource consumption and increase the quality and quantity of productions.
The social characteristics promoted by the product include:
- Increasing employment, especially for young farmers.
- Facilitating agricultural entrepreneurship, particularly among the youth.
- Increasing the presence of young and/or female employees in the agricultural sector.
- Encouraging the participation of agricultural operators, even in rural areas.
- Promoting knowledge transfer and innovation in the agricultural sector, including in rural areas.
- Strengthening agricultural income and stimulating competitiveness.
d) Investment strategy
The main purpose of the Fund will be to invest in the acquisition of land intended for any cultivation or agricultural activity, primarily located in Italy and other EU Member States. These lands will then be leased/managed by agricultural enterprises with characteristics specifically listed in Article 8 of the Fund’s management regulations, providing that a portion of these lands will be leased/managed by the category of young farmers. Additionally, the Fund will adopt an investment policy to promote the environmental and social characteristics mentioned above.
As described in the Group’s ESG Policy and the Company’s Responsible Investment Procedure o (available on the website), Gardant Investor SGR commits, where applicable, to integrate ESG factors into investment decisions, also assessing good governance practices in its exclusion policy. To achieve this, the Company conducts ESG due diligence/screening during the investment phase, requesting for each investment a documentation set that includes information regarding its governance and assigns it an ESG score using a proprietary tool that adheres to certain minimum thresholds.
e) Proportion of investments
The percentage of financial product investments used to meet the environmental or social characteristics promoted by the financial product is 66%.
f) Monitoring of environmental or social characteristics
Specific clauses will be included in the lease agreements to allow monitoring of the environmental and social characteristics. Through a proprietary ESG Tool, parameters connected to the environmental and social characteristics promoted by the product are identified, assessed, and monitored. More generally, with reference to investment decisions, the completion of ESG due diligence/screening is envisaged.
g) Methodologies
For the identification of social and environmental characteristics, the Fund has adopted an internal methodology with the aim of not causing significant harm to any other factor and in compliance with the principle of good governance. Specifically, the sustainability indicators used to measure the environmental or social characteristics promoted by the product are:
- Hectares of land subject to agricultural rotation;
- Percentage of assets allocated to projects of organic and/or regenerative and/or conservative agriculture on the total allocated assets;
- Percentage of assets allocated to agricultural projects using precision farming techniques on the total allocated assets;
- Percentage of assets allocated to agricultural enterprises with environmental certifications on the total allocated assets;
- Percentage of assets allocated for the modernization of agricultural techniques and tools on the total allocated assets;
- Number of farmers under 41 years old receiving aid for the first settlement in a farm as head of the farm;
- Number of farmers under 35 years old receiving aid to start their own entrepreneurial initiative in agriculture;
- Number of agricultural businesses organized as sole proprietorships or companies, composed of young people aged between 18 and 41 or women;
- Number of farmers who have benefited from training/information actions;
- Number of farmers under 41 years old hired;
- Percentage of assets allocated to increase profitability per hectare of cultivated land on the total allocated assets;
- Percentage of assets allocated to agricultural projects in rural areas and/or subject to natural constraints on the total allocated assets;
- Number of farmers operating in rural areas who have benefited from training/information actions.
h) Data sources and processing
To meet each of the environmental or social characteristics promoted by the financial product, data is provided by various counterparties and Gardant Investor SGR’s internal information systems. The data feeds into the proprietary Tool, which allows for the identification, evaluation, and monitoring of parameters related to the social and environmental characteristics promoted by the product and ensures their quality. Gardant has also established a data control process on the information obtained from counterparties, through a verification, validation, and completeness check procedure. Whenever counterparties use estimates in quantifying the data provided to Gardant Investor SGR, evidence of the estimation process will be required.
i) Limitation of methodologies and data
The data and information that feed into the proprietary monitoring Tool for environmental and social characteristics are subject to counterpart availability. This limitation in the potential retrieval of data does not affect how the characteristics promoted by the Fund are satisfied.
j)Due Diligence
Regarding investment decisions, technical, environmental, and legal due diligence is carried out. Counterparties are required to provide a set of documents/evidence to assign an ESG score using a proprietary tool that allows for an initial screening. Additionally, these analyses are also considered by the Risk Management Function. Gardant Investor SGR will perform a consistency check of the Due Diligence with respect to the sustainability strategy of the Fund.
k) Engagement policies
One of the binding elements of Gardant Investor SGR’s investment strategy is the a priori exclusion from the investable universe of:
- Companies operating in stark contrast to principles codified by international norms and conventions (for example, in violation of the United Nations Global Principles);
- Companies operating in controversial sectors and activities belonging to specific exclusion lists, setting thresholds based on a company’s revenues over the previous four quarters. This negative ESG screening specifically refers to companies operating in controversial sectors such as controversial arms (any threshold), coal (threshold of 20% of each company’s revenues over the previous four quarters), conventional weapons (30% of each company’s revenues over the previous four quarters), tobacco (20% of each company’s revenues over the previous four quarters), gambling (20% of each company’s revenues over the previous four quarters), and adult entertainment (any threshold);
- Government issuers under the United Nations sanctions regime, pursuant to Article 31 of the United Nations Charter. Additionally, the allocated assets will always be aimed at ensuring that each investment adopts water efficiency practices (e.g., reducing consumption and adopting new techniques) and optimization of resources used for agricultural production (e.g., reducing waste and the use of chemical fertilizers and pesticides).
As described in Gardant S.p.A’s “ESG Policy,” the Group aims to position itself as one of the most active operators in integrating and promoting environmental, social, and governance (ESG) issues in its business model and activities. The Group’s goal is to offer its clients the solidity and sustainability of a specialized and responsible business through both evolving consolidated tools and the expertise of its people. These objectives are pursued through:
- Adherence to international initiatives such as the UN Global Compact;
- Monitoring the sustainability impacts generated by relevant business activities;
- A responsible approach in credit management and protection;
- Transparency towards stakeholders ensured through periodic reporting of sustainability performance.
l) Designated reference benchmark
No benchmark index has been identified that satisfies the environmental or social characteristics promoted by the Fund.