Christian Hiss grew up on one of Germany’s first organic farms adhering to the strictest of all eco-labels. Seeing first-hand the threat facing local small-scale agriculture, he is broadening the financial base of organic regional agriculture enterprises by defining their success not only in financial return, but also in environmental and social returns. As such, he is attracting investors who value a balanced investment across these three areas. Through his holding company, Regionalwert AG, Christian is reinvigorating regional economies by creating alternative flows of capital and value chains for small organic farmers and food producers. Regionalwert AG’s plan is to spread throughout the Freeburg region, making shares even easier to access through new retail partners, and then to begin the nationwide sale of shares.
Agriculture today is financed much like any other big business: with a view of investment that only includes financial return
This approach leads to major negative environmental and social externalities
Large-scale agriculture is increasingly squeezing out smaller scale regional agricultural economies
Christian has found a sustainable mechanism to connect capital with local agricultural enterprises
THE NEW IDEA
Agriculture today is financed much like any other big business: with a view of investment that only includes financial return. This approach, however, is limited in scope and leads to major negative environmental and social externalities. With few sources of capital available to smaller players in the sector, and with an increasingly competitive marketplace, large-scale agriculture is increasingly squeezing out smaller scale regional agricultural economies. As a result, the industry has suffered from significant losses in jobs, open space and community identity.
Christian’s Regionalwert AG broadens the financial base of organic regional agriculture enterprises by defining their success not only in financial return, but also in environmental and social returns. Instead of investing in anonymous green investment portfolios with difficult to measure impacts, Christian offers investors the opportunity to invest in their own region and therefore remain closely connected to their investments.
Christian’s key insight is that each return – financial, social and environmental – needs to be well accounted for. To do so, he has developed 64 indicators that cover performance in these three arenas. At each annual meeting, the organization’s shareholders learn about the tradeoffs between these returns and can thus make informed decisions on how to balance them in the future.
As a result of Christian’s vision, the Regionalwert AG has creates regional value chains where they did not previously exist. In addition to buying small farms with social and environmental impacts, the holding company also invests in parts of wholesalers or organic catering firms with much higher financial margins. The result is that all three returns – financial, social and environmental – are soundly balanced inside of the holding. By ensuring a balanced return the Regionalwert AG enables regional, small and medium sized farms and grocery producers to survive in a highly competitive market while also allowing local supply chains and synergies to strengthen the region’s sustainable values.
With the Regionalwert AG, Christian has found a sustainable mechanism to connect capital with local agricultural enterprises, thereby creating benefits for entire regional economies. As a leading model for shareholder participation, his idea is not only on track to grow organically, but also to spread to other regions and potentially beyond agriculture.
Christian grew up on one of Germany’s first organic farms. Faced with his parents‘ expectations to take over the farm, he experienced firsthand the challenges of succession planning in agriculture. Instead of taking over his family farm, he chose to initiate his own venture. In addition to his own successful organic nursery that encompasses 15 staff, he has also launched several other initiatives, including a school improvement project and Germany’s first foundation for biodiversity.
„Instead of taking over his family farm, he chose to initiate his own venture.“
Knowing the challenges he faced inheriting his parents’ farm, he did not expect any of his three children to continue his business, so instead he formed his own succession strategy and left his work to launch the Regionalwert AG. After years of experience working in regional and organic agriculture, he saw agricultural holding companies as the true solution to the decline of regional agriculture.
In order to make his project successful, Christian recognized that he needed to better understand the financial context, and has thus enrolled in an extra-occupational online master’s program for social finance in Plymouth, U.K. He anticipates writing his master’s thesis on the Regionalwert AG.
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