Cross-industry recommendations on scaling the agricultural transition in Europe through public-private co-investment and Scope 3 alignment
Context
European farmers face mounting economic and environmental pressure: rising input costs, volatile commodity prices and increasing climate shocks are squeezing farm incomes across the continent. The transition towards more sustainable and resilient farming systems requires new investment models to support long-term viability. Delivering this at scale will depend on the right regulatory and financial conditions, including effective public-private co-investment and credible measurement, reporting and verification (MRV) frameworks.
Regenerative agriculture reflects a systems approach that delivers multiple co-benefits, including improved soil health, water quality, biodiversity and farmer resilience, alongside GHG reductions and carbon removals. In this context, and in line with EU policy terminology, ‘carbon farming’ refers to agricultural practices contributing to carbon removals as part of this broader system. Nature-based solutions (NBS), including land restoration and land-use change (LUC), are complementary pathways within this transition, offering significant potential for carbon removal, climate adaptation, and ecosystem recovery at scale. This includes, for example, the restoration of degraded peatlands, wetlands, and other high-carbon ecosystems. In Europe under the CRCF, certification requires carbon removals to be demonstrated alongside measurable improvements in environmental outcomes. OP2B members are aligned on a holistic approach to the agricultural transition, and these recommendations — while acknowledging GHG outcomes — are intended to be consistent and supportive of this broader agenda.
The Carbon Removal and Carbon Farming (CRCF) Framework, in force since December 2024, establishes harmonised EU rules on certification, MRV and carbon removals in agriculture. As the European Commission operationalises this framework, OP2B and some of its leading members on carbon farming — including Arla, Danone, Diageo, FrieslandCampina, InVivo, Nestlé, PepsiCo, Pernod Ricard and Unilever — have set out recommendations on two main levers for scaling carbon farming: public-private co-investment and alignment with Scope 3 accounting.
These recommendations are intended to inform both CRCF implementation and ongoing standard-setting discussions, including the revision of the GHG Protocol Land Sector and Removals Standard (LSRS) and the SBTi Net Zero and FLAG standards.
Scaling carbon farming will also depend on coherence between the CRCF and the broader EU policy landscape, including the Common Agricultural Policy (CAP), climate reporting frameworks, and nature-related initiatives such as the Nature Credits Roadmap and the Soil Monitoring Law, to ensure consistent incentives, reduce administrative complexity, and provide the regulatory clarity needed to unlock private investment at pace.
Recommendations
Significant barriers are slowing the scale up of the agricultural transition to the required speed, with mobilising both private and public investment remaining the central challenge. The following recommendations identify the enabling conditions the EU could support establishing.
Underpinning all of these recommendations is the need for robust and credible CRCF methodologies. These should meet internationally recognised standards, be consistent with the Paris Agreement, and ensure that CRCF certificates primarily support in-value chain decarbonisation.
1. Mobilise financial incentives through public-private co-investment
Neither public nor private funding alone is sufficient to finance the transition to more sustainable and resilient farming practices. With CAP budgets under pressure in the next EU budget cycle, maximising the leveraging effect of public funding is critical. Co-investment should prioritise farm resilience and long-term transition outcomes, with carbon results acting as one component of the value case.
Effective models could include:
- Blended finance facilities combining Competitiveness Fund grants and corporate investment at farm level, complementing CAP payments
- Financial matching grant incentives, tax credits and improved access to funding for companies investing in value chain transition on-farm
- Multi-year co-investment frameworks that absorb upfront transition costs for farmers
Blended finance would require clear rules on how CRCF certification interacts with existing public support schemes, and whether public or CAP support received by the farmer affects the additionality of CRCF units, and a methodology to allocate claims between co-investors without double counting.
2. Ensure value-chain prioritisation in the use of CRCF-certified outcomes
For agri-food companies to invest in regenerative practices, including those contributing to carbon removals, within their own supply chains, they need confidence that the environmental outcomes they help generate will be available to them, while reducing the risk of double counting across corporate accounting. CRCF certificates generated within a supply chain should ideally be made available first to buyers of the underlying agricultural product. Certified outcomes should be prioritised for use within the relevant value chains. Mechanisms to support this (e.g. first-refusal rights) may be considered where relevant, but the overall framework should remain focused on enabling value-chain investment rather than structuring tradable market mechanisms. Further, first-refusal eligibility might also be defined by demonstrated co-investment and financial contribution to the project. Where relevant, implementation should remain flexible and avoid creating constraints for farmers, including in cases of structural change or exit from the sector.
Without this safeguard, carbon removals and reductions generated within value chains may not fully contribute to value-chain decarbonisation efforts, preventing agri-food companies from counting them towards their Scope 3 targets and farmers from claiming the right to the credit in the agri-food chain — undermining the very incentive for corporate investment in their value chain.
3. Align CRCF with Scope 3 reporting frameworks
The CRCF has the potential to incentivise greater investment in agricultural value chains and support progress towards Scope 3 climate targets. In this context, CRCF can play a role in supporting corporate Scope 3 strategies, including value chain engagement and insetting approaches. To ensure consistency and credibility, we strongly recommend that CRCF follow international reporting frameworks where possible, such as the GHG Protocol.
However, the role of CRCF in Scope 3 inventory accounting remains to be clarified. Companies need clear guidance on whether and how CRCF methodologies and certificates can be used for disclosure in line with existing voluntary frameworks such as the GHG Protocol and Science Based Targets initiative. A single, interoperable basis for Scope 3 reporting would help ensure consistency, but further specification is needed before CRCF-certified outcomes can be systematically reflected in Scope 3 inventories.
In terms of the interaction between CRCF accounting and Scope 3 inventory accounting, corporates need to be able to leverage the CRCF methodology and certificates for Scope 3 inventory-based accounting (rather than project-based accounting). At present, explicit guidance from policymakers is needed on how CRCF certifications could be used for Scope 3 inventory-based accounting purposes, and for future improvements to the methodology to ensure that additionality requirements do not become a barrier to engaging advanced farmers – i.e. those whose emission factors would be mostvaluable for scope 3 accounting. This notably requires clarifying the following elements:
- For a parcel cultivated under a crop rotation system, at what temporal scale shouldquantification be applied: crop rotation time, annually or per crop?
- Where relevant, for Scope 3 claims that need to fit to crop scale, what allocation rules should be applied when quantification covers multiple crops and/or intercrops and/or elements that span the crop rotation (for example a hedge or agroforestry system)?
- What type of claim should be used for carbon removals located outside the crop boundary but financed by the purchaser of the crop?
In particular, the current interpretation of additionality under the CRCF may create a structural obstacle by putting early adopters who have already implemented improved practices at a disadvantage. Addressing this issue, for example through the use of maintenance payments, will be important to ensure that frontrunner farmers are not excluded and that CRCF can effectively support value chain decarbonization.
Clear rules on how CRCF-certified outcomes can be used in corporate climate reporting and sustainability claims will be critical to unlocking private investment. In particular, there should be clear EU recognition of CRCF-certified removals for use in CSRD/ESRS reporting and compliance with the Empowering Consumers for the Green Transition Directive. Without alignment between the various regulatory and voluntary frameworks, and clarity on the claims that companies can make when investing in value chain transition incentives for businesses to invest through CRCF mechanisms will remain limited.
The future CRCF registry should support corporate reporting by aligning with ESRS, GHG Protocol and SBTi; clearly differentiating reductions, removals and avoided emissions; specifying eligible claims (Scope 3 accounting, insetting vs. offsetting); registry and supply chain traceability; and providing robust safeguards against double counting.
Beyond reporting alignment, CRCF has an important role to play in supporting the practical implementation of the GHGP LSRS and SBTi FLAG standards at field level. In particular, CRCF methodologies and registry infrastructure can help resolve currently open questions around claims eligibility, the boundaries of Scope 3 allocation across crop rotations, and traceability-related attribution challenges — areas where standard-setters need real-world operational input to finalise guidance.
4. Ensure coherence between CRCF and the broader EU policy framework
The effectiveness of the CRCF will depend on strong alignment with the broader EU policy landscape, including the Common Agricultural Policy (CAP), On-Farm Sustainability Compass, climate reporting frameworks (CSRD/ESRS), and nature-related initiatives such as the Nature Credits roadmap and the Soil Monitoring Law. Coherence across these frameworks is essential to provide consistent incentives, reduce administrative burden, and unlock private investment.
The European Commission should ensure that CRCF implementation is aligned and complementary with CAP instruments, enabling public support and private finance to operate in a complementary and mutually reinforcing way. At the same time, CRCF should be interoperable with existing climate and sustainability reporting frameworks, including the GHG Protocol and SBTi, with clear rules on how certified outcomes can be used.
Stronger coordination across agriculture, climate, and nature policies will be critical to support integrated landscape approaches, including regenerative agriculture, conservation, and restoration, and to provide the regulatory clarity needed for long-term investment.
5. Reduce transaction and MRV costs while establishing harmonized systems
Agricultural practices contributing to carbon sequestration will only achieve widespread adoption if it is economically viable and administratively manageable for individual farmers. Dedicated support mechanisms should therefore reduce MRV costs, minimise administrative burden, and provide long-term price predictability.
At the same time, harmonised sustainability benchmarks and consistent MRV systems are essential to build private investor confidence and enable recognition of environmental co-benefits such as biodiversity and soil health, particularly at landscape scale.
To support this, the EU and Member States should develop trusted, low-cost, and interoperable data infrastructure, drawing on existing CAP resources (e.g. LPIS and cropping history). Public investment in systematic MRV can lower costs for all users and reduce fragmentation across national programmes. For example, while soil sampling is one of the most accurate methods for measuring soil organic carbon, it remains costly and labour-intensive, highlighting the need for more efficient, scalable approaches, such as the use of satellite imagery, remote sensing technologies, modelling tools, and digital farm-level data integration. Overall, the system must facilitate transactions that benefit farmers and incentivize investments.
Role of the EU Buyers’ Club and Purchasing Facility
The Buyers’ Club and Purchasing Facility can help operationalise the recommendations above, particularly on financial incentives and demand aggregation. Their core functions should be to:
- Provide financial incentives (existing EU funds, grants, etc.) and risk management tools that reduce the risks and costs of early adoption by companies in the value chain.
- Create stable, long-term demand: Coordinate demand signals across industry to provide predictable revenue streams for farmers and reduce investment risk.
- Facilitate procurement and aggregation: Facilitate coordination across value-chain actors, including demand alignment and investment planning.
- Ensure value-chain priority: Guarantee that CRCF certificates are made available first to actors within the relevant supply chain before use outside the value chain is considered (where relevant).
- Support co-investment at farm level: Provide co-investment frameworks to help farmers absorb upfront costs and navigate multi-year transition pathways, with clear claim allocation rules between co-investors to create incentives for investment for multiple layers of the value chain according to GHG Protocol rules.
- Drive MRV and Scope 3 alignment: Coordinate data and MRV standards with the CRCF registry so that corporate buyers can use certified outcomes directly for Scope 3 reporting.
- Structure for different use cases: Multiple Buyers’ Clubs with differentiated eligibility criteria could address distinct market needs, for example by differentiating removal types (soil carbon, forestry, peatland) and intended use (in-value-chain mitigation vs. voluntary market offsets).
- Accommodate Europe’s diversity of soils, landscapes and farming systems, including regions where carbon-productive land is not exclusively associated with active agricultural production. Eligibility criteria designed around uniform, highly productive soils risk excluding high-value landscapes and above-ground carbon pathways such as agroforestry. The underlying infrastructure for the club should be designed for interoperability across carbon, biodiversity, water and soil health outcomes from the outset, thereby avoiding fragmented parallel systems as multi-outcomes reporting requirements under EU legislation continue to expand.
OP2B recommends an incremental approach: start with realistic reduction & removal ambitions and increase targets over time as methodologies and reporting frameworks mature. The Buyers’ Club should function as a pragmatic coordination mechanism, designed to be workable for farmers and value-chain actors from the outset.
Outline