REGULATING RISK

The document contends that voluntary sustainability initiatives are fundamentally flawed and insufficient to curb the global land grabbing crisis. It provides evidence of the significant financial involvement of EU-based institutions in agribusinesses that cause environmental and social harm, particularly in developing countries. The authors argue that the lack of monitoring, sanctions, and accessibility in voluntary schemes allows irresponsible actors to continue harmful practices. To address this, the briefing recommends mandatory human rights due diligence, expanded reporting requirements under EU directives, and binding regulations for financial investors to ensure only legally compliant agribusiness concessions are eligible for investment.

• Since 2000, at least 38.9 million hectares of land in developing countries have been leased to companies or are under negotiation, driven by demand for biofuels, raw materials, and financial speculation.
• EU financial institutions are major contributors to overseas agribusiness; by early 2015, top EU-based institutions provided nearly US$18 billion in outstanding loans and underwriting to foreign agriculture companies in developing countries, while the top 20 institutional investors held US$2.8 billion in shares.
• Agricultural commodity production is now the primary threat to global forests, with the EU identified as the largest net importer of 'embodied deforestation' per capita between 1990 and 2008.
• Voluntary initiatives are deemed ineffective substitutes for regulation because they typically only attract already responsible actors, lack robust monitoring and reporting, and offer few or no sanctions for non-compliance.
• Failure to address land tenure risks creates material financial risks for corporations, including construction delays and cash flow losses; operating costs for a US$10 million investment can be 29 times higher if forced to stop due to local opposition.
• The 'comply or explain' mechanism in corporate reporting is viewed as a loophole; for example, 39% of FTSE 350 companies failed to either comply with or explain their deviation from the UK's Stewardship Code.

APA

Global Witness (2016). REGULATING RISK. https://globalwitness.org/documents/164/Global_Witness_Regulating_Risk_Nov_2016.pdf

Chicago

Global Witness. REGULATING RISK. 2016. https://globalwitness.org/documents/164/Global_Witness_Regulating_Risk_Nov_2016.pdf.

Wikipedia

{{cite report |author=Global Witness |title=REGULATING RISK |date=2016 |url=https://globalwitness.org/documents/164/Global_Witness_Regulating_Risk_Nov_2016.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{globalwitness2016regulating, author = {{Global Witness}}, title = {{REGULATING RISK}}, institution = {Global Witness}, year = {2016}, url = {https://globalwitness.org/documents/164/Global_Witness_Regulating_Risk_Nov_2016.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }