Secret of success: science plus business

On 15 December, the Director of the FAO Office in Moscow Oleg Kobiakov participated in the expert session "ESG in agro: green or carbon?" within the framework of the VIII Congress titled "Innovative practice: science plus business". Lomonosov Moscow State University and “Innopraktika” company organized the Congress.                  

Oleg Kobiakov thanked the organizers and reminded them that "FAO is one of the UN specialized agencies possessing a universal mandate in agriculture and food security as well as in forestry, fisheries and aquaculture." 

"75 years ago, FAO was established by the member countries, including the Soviet Union – a founding member of FAO, and Russia, which, it so happened, joined the Organization not straight away, but 60 years later, and, as for today, it is one of the leading nations in the Organization. The FAO’s mission focuses on combatting global hunger and ensuring that the rural society’s lifestyle is compatible with the modern level of development, and, moving further, conserving the planets’ resources. How do we manage it? As for now, not quite successfully, because hunger has not been eradicated worldwide. On the other side, after World War II, the global population accounted for 2.5 billion people, 1 billion out of which went hungry on a daily basis. Now, the planet’s population is approaching 8 billion, and the number of starving people slightly exceeds the 800 million mark. The progress is indeed enormous. In such developed countries as Russia, hunger has been fully eliminated as a phenomenon. Nationally, only 6 percent of the population feels just temporary food insecurity."  

It is appropriate to ask ourselves a question: the population is growing, production is broadening – to what degree the global agri-sector and the domestic one will be able to meet this increasing demand. People’s needs are constantly multiplying not only in their quantity but also in their quality, structure, influence on human health, and it should be noted that health is the foundation on which a fulfilling life can only be built.  

FAO has issued two flagship publications. One of them is titled "The State of Food and Agriculture", a two-year report. It is dedicated to agri-food systems. The second report is titled "The State of the World’s Land and Water Resources for Food and Agriculture". In a week, we will present these two reports, issued in Russian as well, together with the depositary of FAO documents in Russia – the Central Scientific Agricultural Library. 

So, what functions did the founding fathers endow FAO with? They authorized it to collect best practices; to provide a platform for exchanging experiences; to conduct and encourage research with the financial support of both member countries and businesses. I am pleased to mention that PhosAgro has been funding FAO's research on soil quality analysis, optimizing expertise in sustainable soil management, and, finally, the very chemicalization, fertilizer application, for years. FAO also summarizes and shares best forestry practices, which comprises fighting forest fires, reforestation, minimizing deforestation, and new forestry technologies.  

Given the urgency of reducing emissions and avoiding further atmospheric warming, there are several ways to decrease agricultural carbon footprint. According to FAO, the global agri-sector is responsible for 13 percent of carbon dioxide emissions, 44 percent of methane emissions and 81 percent of nitrous oxide emissions on land alone. And of course, we will not meet the 2050 decarbonization targets if we do not address this challenge in the agri-food sector.  

Here FAO proposes to take on board several forward-looking strategies. The first one is reforestation, given the large-scale absorption capacity of trees, which is higher in Russian temperate forests than in Brazilian silva. 

The second one is organic soil conservation agriculture. Of course, not everything is clear either. The last recommendations are to leave 30 percent of organic residues on soil. But they also decay and release carbon dioxide. If you put them in soil, the release of carbon dioxide is reduced, but on the other hand, this slows down the renewal of humus in soil, which affects its fertility.  

And finally, the third one. The fastest way to reduce the industry’s carbon footprint and boost the whole chain efficiency, according to our economists’ expertise, is the fight against losses and waste. These two negative phenomena are not just losses in production, but waste of precursors as well, which means energy costs for producing fertilizers that are especially high when producing nitrogen fertilizers. This is fuel for transport, which is involved at all stages of the agri-food chain, and we should not forget that transport produces a high share of emissions in agriculture. This is, finally, the wasted labour of a huge number of people who have produced, packaged, and marketed food products throughout the value chain. 

To reach its goals, FAO is creating wide coalitions, including not only agri-food industry’s actors but representatives of the government, parliaments, academia, industry associations, and consumer unions as well. Here in Russia, we successfully develop cooperation in animal production and health, plant production and protection, genetics, fisheries, and aquaculture. 

The last thing that needs to be mentioned is the challenges of international cooperation. Firstly, the production and consumption of agricultural products are now highly internationalized and realized through the market. Secondly, the factors of production are also global: wind erosion in Kazakhstan will inevitably affect Russia; a foot-and-mouth disease outbreak in Mongolia will inevitably spill over into Russian territory; a locust infestation, that has reached Uzbekistan, can be expected in a fortnight in Kalmykia and Astrakhan Oblast. Therefore, Russia, as a rich and rapidly developing country, should make a significant contribution, including a financial one, to international cooperation, through FAO as well, and thus ensure itself markets, food security, and to a large extent, the implementation of the ESG strategy, but already in a global format," stressed the Head of the FAO Moscow Office. 

At the end of the session, its moderator Mikhail Sterkin, Marketing and Development Director of PhosAgro, conducted a quick round of questions, asking the panelists whether the ESG approach could become an engine for growth and strengthen the position of the Russian agro-industrial complex in the global market. 

"Russia's agricultural sector has made a huge leap, especially over the last ten years. Unfortunately, it is rapidly moving towards the exhaustion of quantitative growth factors. The ESG approach is, therefore, the only true key to holding on to these positions and moving confidently into the future,"answered Oleg Kobiakov. 

The experts’ session was also attended by: Boris Levin, Deputy Chief of Staff for the CEO of PhosAgro; Andrei Novikov, Cherkizovo Group Investor Relations Manager; Aleksandr Nikitin, Vice-President of Miratorg Agribusiness Holding; Svetlana Kuznetsova, Investor Relations and Sustainable Development Director, Rusagro Group of Companies; Vugar Bagirov, Director of the Department for the Coordination of Agricultural Science Organizations of the Ministry of Education and Science of the Russian Federation; Anna Kuznetsova, Deputy Chairman of the Management Board, Russian Agricultural Bank; Vladimir Avdeyenko, Head, Directorate for the Development of Agri- and Biotechnologies, Innopraktika.